Petrobras Ignored Warnings About Fuel Broker Implicated In Graft Probe

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Brazil’s Petrobras found suspicious activity in its oil trading business – and failed to stop it – six years before an alleged bribery scandal erupted in that unit in 2018, according to three people with knowledge of the situation and documents seen by Reuters.

A 2012 internal probe at the state-run oil company turned up more than two dozen instances in which traders in Petrobras’ Singapore office overpaid for fuel, the people said. Big oil companies frequently purchase and sell petroleum products, taking advantage of price differences to maximize profits. Some employees in 2013 recommended halting transactions with one particular fuel brokerage that had consistently sold fuel to Petrobras at above-market prices, according to the people.

But the deals continued at the behest of at least three senior company managers, the people said.

The little-known fuel broker – Seaview Shipbroking Ltd – was subsequently implicated by prosecutors in Brazil’s long-running “Car Wash” corruption investigation centered on contracting graft at Petrobras. Authorities say this latest chapter of Car Wash is just ramping up.

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