Petrobras ADRs (PBR) fell 16.63% and PBRA 18.27% on Monday, joining a rout in Brazilian stocks after President Luiz Inácio Lula da Silva beat conservative challenger Flávio Bolsonaro 51.8% to 48.2% in the runoff, a result that surprised investors who had expected a Bolsonaro win. Bolsonaro is refusing to concede and alleges the administration suppressed votes in key districts, while nearly all other Latin American leaders have congratulated Lula, with only Argentine President Javier Milei holding back. The article notes that since 2023 Lula has placed government control at the center of energy policy, imposing price controls on domestic fuel sales, ending privatization of Petrobras's assets, and ordering the company to expand production and favor capital investment over dividends. These moves may look negative in the short term but could pay off over the longer term, and Petrobras shares trade at 6.6x trailing earnings.
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