Presidential election focus shifts to Petrobas as allegations of bribery emerge

With the country’s presidential election just a month away, Brazilians’ focus during the home stretch of campaign season has shifted to state-owned oil producer, Petrobas,…

With the Brazil’s presidential election just a month away, Brazilians’ focus has turned to Petrobas which is at the center of a scandal. (Photo by Per-Anders Pettersson/Getty Images)

With the country’s presidential election just a month away, Brazilians’ focus during the home stretch of campaign season has shifted to state-owned oil producer, Petrobas, which is once again at the center of a pervasive political scandal. The nationalized oil corporation—notorious for its corrupt and obscure business practices—is the focal point of all new and far-reaching allegations of bribery that have emerged involving several high level officials across the country.

The allegations involve several major political players—including energy minister, Edison Lobão, and the leaders of both houses of Congress, Henrique Eduardo Alves and Renan Calheiros— that are closely associated with current President and re-election hopeful, Dilma Rousseff. As Simon Romero of The New York Times reports, “Details of the scheme were revealed in confidential testimony by Paulo Roberto Costa, a jailed former executive who oversaw refining operations at Petrobras until 2012. The testimony was obtained by Veja, a Brazilian magazine.”

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Costa—who served as one of Petrobas’ chief executives from 2004 to 2012— was arrested earlier this year after evidence emerged proving his involvement in a money-laundering scheme. As Roberto goes on to explain, “Brazilian prosecutors said they discovered that Mr. Costa had kept about $23 million in Swiss bank accounts after profiting from the scheme.” Ultimately, upon his indictment, Costa accepted a plea deal in exchange for the sharing of more information surrounding the circumstances of the money-laundering operation.

Since, Veja acquired the names mentioned in Costa’s testimony and released them publicly. According to Costa, politicians would receive up to 3 percent of the profits for all oil projects. While the allegations are still unproven and yet to be investigated by federal investigators, they have accentuated a growing strain of discontent that has emerged as Brazilians grow increasingly disillusioned with what they see as a corrupt and inert government.

Meanwhile, the revelation of the allegations further hinders President’s Rousseff’s already troubled re-election bid as most of the accused politicians held close ties with the president. Rousseff’s main rival, Marina Silva has jumped on the accusations as she steadily continues to climb the polls.

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Silva emerged as Rousseff’s primary opponent in August after a bizarre series of events involving the death of her former running mate, Eduardo Campos, bolstered her from the vide-presidential to presidential candidacy. However, despite her opportunistic use of the accusations, Silva isn’t entirely immune from the allegations as her former running mate was also mentioned in the testimony made by Mr. Costa.

In that light, it’s the problem’s scale and extent that seems to worry Brazilians most. As Carla Jimenez of El Pais suggests, “Petrobras is an issue of national concern because the entire country identifies with the company. Many citizens have bought shares in it, often using their retirement funds.”

While Mrs. Silva has made the environment, a lower reliance on Petrobas, and greater investment in renewable energy the centerfold of her platform, President Rousseff maintains that Petrobas—while in need of reform—is an integral part of the country’s economy. As election day nears, it’s unlikely that the oil giant will fade from the forefront of the public’s attention as they head to the polls.