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| Petrobras Executives Leaving Amid Brazilian Graft Scandal | Petrobras Executives Leaving Amid Brazilian Graft Scandal |
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| BUENOS AIRES — The leadership of Petrobras, the Brazilian national oil giant grappling with a sprawling graft scandal, abruptly resigned on Wednesday amid accusations of a bribery scheme involving kickbacks to President Dilma Rousseff’s governing Workers Party and its allies. | |
| The shake-up included the departure of Maria das Graças Foster, the chief executive handpicked in 2012 by Ms. Rousseff, following months of tumult at the state-controlled oil company. Skepticism had grown over Ms. Foster’s capacity to deal with the scandal at a time when low oil prices are also forcing the company to slash spending on costly projects. | The shake-up included the departure of Maria das Graças Foster, the chief executive handpicked in 2012 by Ms. Rousseff, following months of tumult at the state-controlled oil company. Skepticism had grown over Ms. Foster’s capacity to deal with the scandal at a time when low oil prices are also forcing the company to slash spending on costly projects. |
| Ms. Rousseff had recently decided to replace Ms. Foster and other senior executives this month, according to news reports, fueling a surge in Petrobras shares. The newspaper O Globo reported on Wednesday that Ms. Foster insisted on resigning after meeting on Tuesday with the president in Brasília. | Ms. Rousseff had recently decided to replace Ms. Foster and other senior executives this month, according to news reports, fueling a surge in Petrobras shares. The newspaper O Globo reported on Wednesday that Ms. Foster insisted on resigning after meeting on Tuesday with the president in Brasília. |
| Reflecting a low point for Ms. Rousseff, who narrowly won re-election in October in a bitter election marked by attacks on her management of Petrobras and Brazil’s sluggish economy, even some within her own party said she had been too slow to make changes at the oil company. | Reflecting a low point for Ms. Rousseff, who narrowly won re-election in October in a bitter election marked by attacks on her management of Petrobras and Brazil’s sluggish economy, even some within her own party said she had been too slow to make changes at the oil company. |
| “In my opinion this move should have been taken some time ago,” Paulo Pimenta, a congressman from the Workers Party, told reporters in Brasília. | “In my opinion this move should have been taken some time ago,” Paulo Pimenta, a congressman from the Workers Party, told reporters in Brasília. |
| The upheaval at Petrobras was set off largely by testimony from Paulo Roberto Costa, a former executive at the oil company who was arrested by the police in 2014. As part of a plea deal, he surrendered $25 million hidden in offshore accounts, offering a rare glimpse into the inner workings of Petrobras, a company that long had an almost mythic nationalist aura in Brazil. | The upheaval at Petrobras was set off largely by testimony from Paulo Roberto Costa, a former executive at the oil company who was arrested by the police in 2014. As part of a plea deal, he surrendered $25 million hidden in offshore accounts, offering a rare glimpse into the inner workings of Petrobras, a company that long had an almost mythic nationalist aura in Brazil. |
| Mr. Costa described a scheme in which Petrobras inflated budgets for oil projects and construction companies paid bribes worth about 3 percent of the value of the projects to obtain contracts. The funds were then distributed among senior Petrobras executives and channeled to the Workers Party and other parties in Ms. Rousseff’s governing coalition, Mr. Costa said. | Mr. Costa described a scheme in which Petrobras inflated budgets for oil projects and construction companies paid bribes worth about 3 percent of the value of the projects to obtain contracts. The funds were then distributed among senior Petrobras executives and channeled to the Workers Party and other parties in Ms. Rousseff’s governing coalition, Mr. Costa said. |
| The investigation of the scheme has already involved the arrest and imprisonment of senior executives at some of Brazil’s largest construction companies, a highly unusual development in a country where powerful business figures rarely spend time in jail. The steady drip of testimony from some of these executives suggests the scandal is far from over. | The investigation of the scheme has already involved the arrest and imprisonment of senior executives at some of Brazil’s largest construction companies, a highly unusual development in a country where powerful business figures rarely spend time in jail. The steady drip of testimony from some of these executives suggests the scandal is far from over. |
| “The mudslide is now at Dilma’s door,” said David Fleischer, professor emeritus of political science at the University of Brasília, referring to the president informally by her first name as is common in Brazil. “She ousted Foster, who asked to resign some time ago, because she had no other alternative.” | “The mudslide is now at Dilma’s door,” said David Fleischer, professor emeritus of political science at the University of Brasília, referring to the president informally by her first name as is common in Brazil. “She ousted Foster, who asked to resign some time ago, because she had no other alternative.” |
| With Petrobras, a publicly traded company with investors around the world, coming under more scrutiny, the Securities and Exchange Commission and the Justice Department in the United States are also investigating the corruption revelations. Meanwhile, credit rating agencies have expressed growing concern over the depth of the oil giant’s problems. | With Petrobras, a publicly traded company with investors around the world, coming under more scrutiny, the Securities and Exchange Commission and the Justice Department in the United States are also investigating the corruption revelations. Meanwhile, credit rating agencies have expressed growing concern over the depth of the oil giant’s problems. |
| It remains unclear how Ms. Rousseff, who resisted pressure for weeks to remove Ms. Foster, will handle the thorny task of replacing her and other senior executives at Petrobras. The company said in a statement that its board, which is controlled by Brazil’s government, would meet on Friday in Rio de Janeiro to elect replacements. | It remains unclear how Ms. Rousseff, who resisted pressure for weeks to remove Ms. Foster, will handle the thorny task of replacing her and other senior executives at Petrobras. The company said in a statement that its board, which is controlled by Brazil’s government, would meet on Friday in Rio de Janeiro to elect replacements. |