Oil tops Brazil’s exports, drives half of trade surplus

Brazil’s trade surplus in crude oil and oil products reached a record $31.22 billion in the first nine months of 2026, up 40% from the same period last year. The figure accounted for half of the country’s overall trade surplus and slightly exceeded the $31.18 billion surplus generated by all other goods combined.

Crude oil overtook soybeans in September to become Brazil’s largest export product, a position analysts interviewed by Valor expect it to retain. Rising export volumes and persistently high prices should keep oil a major driver of the country’s trade surplus. Soybeans had held the top spot through August.

José Augusto de Castro, president of the Brazilian Foreign Trade Association (AEB), expects oil exports to reach $59.96 billion this year, up 34.2% from 2025. Soybeans are projected to rank second at $53.25 billion, a 22.3% increase, making another substantial contribution to Brazil’s trade surplus, which the association forecasts at $85.26 billion for 2026, compared with $68.07 billion last year.

Brazil has historically run a deficit in oil products, and that gap widened 9.3% to $6.54 billion between January and September. But the crude oil surplus climbed 33.5% to a record $37.76 billion, more than offsetting the larger deficit in refined products.

The figures come from the Foreign Trade Indicator (Icomex), compiled by the Brazilian Institute of Economics at Getulio Vargas Foundation (FGV Ibre).

Higher prices and volumes

The conflict in the Middle East has driven up prices for both crude oil and refined products, affecting Brazil’s exports and imports, said Lia Valls, Icomex coordinator and associate researcher at FGV Ibre.

The conflict has also contributed to stronger crude export volumes, alongside rising domestic production, said André Valério, an economist at Inter.

“Petrobras is producing more and more oil. There is a combination of maturing pre-salt fields and the external environment,” he said.

Icomex data show that average crude oil export prices rose 17% in the January-to-September period compared with a year earlier, while shipments increased 12.1% by volume. Together, these gains lifted crude export revenue by 28.6%.

Higher oil prices and tight supplies of refined products also pushed up the average price of fuels imported by Brazil by 35.1%. Import volumes fell 8.1%, cushioning the impact of those price increases, but total spending on imported fuels still rose 23.2%.

Valério expects crude oil to finish the year as Brazil’s leading export product.

“At this point in the year, there is no longer as much competition from agriculture because the bulk of exports has already taken place. And we see no major sign that the oil market dynamics will change in the very short term. It will be difficult to see a sharp drop in oil prices because strategic reserves, which have been significantly depleted, will likely need to be replenished.”

Production expansion

Bruno Cordeiro, a market intelligence analyst at StoneX, said an increase in Brazilian oil production had already been expected for 2026.

The Annual Production Plan (PAP), published by Brazil’s National Agency of Petroleum, forecasts average output of 4.19 million barrels per day this year, up 24.5% from the 2025 average.

Cordeiro noted that higher production is also helping meet domestic demand.

“Refineries are producing more, particularly diesel and jet fuel, to supply the domestic market. The International Energy Agency had already projected that Brazil would be one of the fastest-growing secondary suppliers, meaning producers with output of up to 5 million barrels per day. Brazil is managing to supply more of its domestic market while also increasing the volumes shipped abroad.”

The Middle East conflict has constrained crude supplies, particularly affecting consumers in the Persian Gulf, while the market for refined products is facing a separate refining crisis, he said.

“Ukrainian attacks on Russian refining facilities and attacks by the Houthis, an Iran-allied group, on refineries in Saudi Arabia, together with delays in oil deliveries, have all contributed to a decline in global fuel production. The resulting supply constraints affect not only crude oil but also fuels. As a result, Brazilian refineries have naturally begun consuming more oil.”

StoneX currently expects oil prices to remain above $100 a barrel in the final quarter of 2026. Cordeiro cautioned, however, that the forecast depends partly on an expected resolution of restrictions on passage through the Strait of Hormuz after the U.S. midterm elections on November 3.

Inter now forecasts an $89 billion surplus for Brazil’s overall trade balance in 2026, substantially above its initial estimate of roughly $70 billion to $75 billion. Much of the upward revision reflects stronger-than-expected oil exports, Valério said.

September surge

Brazilian crude exports reached $6.5 billion in September, jumping 77.3% from the same month in 2025. Oil accounted for 18.9% of the country’s total exports that month, lifting its share of shipments in the first nine months to 15.1% and making it Brazil’s leading export product.

Cordeiro said a possible explanation for the September surge was the schedule of planned maintenance shutdowns at domestic refineries. Some facilities suspended operations during September, with maintenance continuing into October.

The shutdowns reduced domestic demand for crude, leaving more oil available for export, he explained.

Shifting export markets

The international environment has also created opportunities for Brazil to diversify its oil export destinations, Valério said.

“We are exporting more to Southeast Asia. India has been buying substantial volumes. China bought a great deal at the beginning of the conflict and has slowed somewhat, although its purchases remain above last year’s levels.”

Data from the Ministry of Development, Industry, Trade and Services (MDIC) show that China remained the largest buyer of Brazilian crude, accounting for 50.7% of exports between January and September 2026, up from 43.9% a year earlier.

Chinese government statistics rank Brazil as China’s third-largest crude oil supplier in the January-to-August period, behind Russia, the leading supplier, and Saudi Arabia.

India also gained prominence as a destination for Brazilian crude, increasing its share from 3.4% in 2025 to 7% this year. Asia excluding the Middle East accounted for 66.5% of exports, up from 57.5%.

The United States moved in the opposite direction, with its share falling from 11.6% to 5.8% in the first nine months. Brazilian oil shipments to the U.S. dropped 35.8% over the period.

The European Union’s share also declined, from 23.9% to 21.1%, although the value of crude exports to the bloc increased 13.5%.

Valls highlighted a particularly strong performance in September, when Brazilian crude exports to the European Union reached $2.4 billion, compared with $1.4 billion a year earlier. The bloc absorbed 36.4% of Brazil’s total crude oil exports that month, MDIC data show.

Long-term challenges

Oil has unquestionably strengthened Brazil’s trade surplus and external accounts this year, Valls said. But she cautioned that even with the prospect of developing oil reserves along the Equatorial Margin, the industry remains exposed to the structural changes brought about by the energy transition.

She also stressed the importance of channeling some of the wealth generated by oil production into activities that create greater economic dynamism within Brazil, including industries linked directly to oil exploration and production.

“We have this gift from nature, but it is a finite resource,” she said.

Source: Valor International

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