By Jeffrey T. Lewis
SÃO PAULO--Petróleo Brasileiro's preferred shares rose 3.9% after the office of the Brazil's Solicitor General issued an opinion that could help the oil company known as Petrobras expand exploration activities in certain offshore waters.
The preferred shares reached 31.80 reais, the equivalent of $6.49, and were up 25% from the end of last year through Tuesday's close. Brazil's benchmark Ibovespa stocks index was up 1% in morning trading.
The Solicitor General's office said on Tuesday near the close of trading that the lack of certain environmental studies can't prevent the issuance of environmental licenses for exploration and production of oil and natural gas. The report is helping Petrobras shares, according to Luan Alves, head of equity research at VG Research.
Earlier this year, the Brazilian Institute of the Environment and Renewable Natural Resources, or Ibama, declined to approve the oil company's application to drill wells off the coast of Brazil's state of Amapa.
Recent comments by a Petrobras official that the company will focus on investing in profitable assets also is supporting the share price, as are recent upgrades to ratings for the oil company, Alves said.
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(END) Dow Jones Newswires