PETROBRAS TURNS AROUND

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24.10.2016

Pedro ParentePresident & CEO of Petrobras

Disclaimer

—

FORWARD-LOOKING STATEMENTS:

The presentation may contain forward-looking statements aboutfuture events within the meaning of Section 27A of the SecuritiesAct of 1933, as amended, and Section 21E of the SecuritiesExchange Act of 1934, as amended, that are not based on historicalfacts and are not assurances of future results. Such forward-looking statements merely reflect the Company’s current views andestimates of future economic circumstances, industry conditions,company performance and financial results. Such terms as"anticipate", "believe", "expect", "forecast", "intend", "plan","project", "seek", "should", along with similar or analogousexpressions, are used to identify such forward-looking statements.Readers are cautioned that these statements are only projectionsand may differ materially from actual future results or events.Readers are referred to the documents filed by the Company withthe SEC, specifically the Company’s most recent Annual Report onForm 20-F, which identify important risk factors that could causeactual results to differ from those contained in the forward-lookingstatements, including, among other things, risks relating to generaleconomic and business conditions, including crude oil and othercommodity prices, refining margins and prevailing exchange rates,uncertainties inherent in making estimates of our oil and gasreserves including recently discovered oil and gas reserves,international and Brazilian political, economic and socialdevelopments, receipt of governmental approvals and licenses andour ability to obtain financing.

We undertake no obligation to publicly update or revise anyforward-looking statements, whether as a result of newinformation or future events or for any other reason. Figures for2016 on are estimates or targets.

All forward-looking statements are expressly qualified in theirentirety by this cautionary statement, and you should not placereliance on any forward-looking statement contained in thispresentation.

In addition, this presentation also contains certain financialmeasures that are not recognized under Brazilian GAAP or IFRS.These measures do not have standardized meanings and may notbe comparable to similarly-titled measures provided by othercompanies. We are providing these measures because we usethem as a measure of company performance; they should not beconsidered in isolation or as a substitute for other financialmeasures that have been disclosed in accordance with BrazilianGAAP or IFRS.

NON-SEC COMPLIANT OIL AND GAS RESERVES:

CAUTIONARY STATEMENT FOR US INVESTORS

We present certain data in this presentation, such as oil and gasresources, that we are not permitted to present in documentsfiled with the United States Securities and Exchange Commission(SEC) under new Subpart 1200 to Regulation S-K because suchterms do not qualify as proved, probable or possible reservesunder Rule 4-10(a) of Regulation S-X. 2

35

45

55

65

75

85

95

105

115

125

135

145

155

165

175

185Petrobras Brent

Investors are seeing the recovery of the company

—

Despite the lower oil

prices, investors believe in

the recovery of Petrobras

Petrobras Market Value x Brent (01/01/2015=100)

3

Source: Bloomberg

1 Year

Annual TSR (Dec ’15-Dec '16)1

Estimated Debt Cost

Term Jan. 31 1 month ago 1 year ago Maximum

5 years 5,4 % p.a. 6,6% p.a. 12,3% p.a.15,9% p.a.

(09/29/15)

10 years 7,0% p.a. 7,8% p.a. 11,8% p.a.14,4% p.a.

(01/20/16)

30 years 7,9% p.a. 8,6% p.a. 10,8% p.a.13,2% p.a.

(02/11/16)

Liability Management

3 sucessful liability management offers between May 2016 and

January 2017

US$ 14 bn in issuances and US$ 15 bn in repurchases helped reduce

cost of funding and extended maturities

Awarded “Corporate Liability Management of the Year” by

LatinFinance Magazine

TSR: Earnings growth, Change in valuation multiple and Free Cash Flow yieldSource: Capital IQ; BCG analysis, BCG

In 2016, higher total shareholder return and lower cost of debt

—

4

Safety activities on a typical day

Headcount at shipyards 38.000

Safety Dialogues 4.000

Work Permits 10.000

Confined Space Entry Permits 400

Interventions 1.500

Work Permits Audits 2.000

Job Safety Analysis 4.500

Distance travelled by trucks (million km/day) 1,7

Source: Petrobras and subsidiaries

Making safety our top priority

—

Our safety daily challenge SAFETY

Reduction of

36%In the Total Recordable Injury

Frequency Rate (TRIFR*)

5

TO

1.4by 2018

FROM

2.2in 2015

Deleveraging the company

—

DRIVERS

Competitive prices

Partnerships and Divestments

Opex Efficiency

Capex Efficiency

FINANCIAL

Reduction in

LEVERAGENet Debt/EBITDA

TO

2.5by 2018

FROM

5.3in 2015

6

Import

New pricing policy in place since October 2016

—

How was it?

How it is now?

Need for more frequent changes

Shorter-term adherence to price

changes in international markets

Decisive element for

downstream partnerships

Guidelines of the new

pricing policy

-2,7

-10,4

9,5

6,1

-5,1

-3,2 -3,1

8,1

0

-1,4

-12

-7

-2

3

8

Oct 16 Nov 16 Dec 16 6 Jan 17 27 Jan 17

Price changes

Diesel Gasoline

%

7

0

5

10

15

20

25

30

35

40

45

Petrobras BP Chevron ExxonMobil Total

2014 2015 2016 Estimate

Selected Companies Capex

(US$ Billion)

Sources: Evaluate Energy, Energy Intelligence, Company Report

-18%

Lower investment is an industry trend

—

-16%-19%

-16%

-38%

8

40

45

50

55

60

65

70

75

80

85

90

95

100

2013200520042001 2014 2016

Jan-Set

201520092008 2010 201220112007200620032002

ExxonPetrobras Shell Chevron BP

CAPEX E&P / CAPEX Total

Investment is focused on core business

—

100

95

90

85

80

75

70

65

60

55

50

45

40

%

9

Manageable operating costs* – 2017-18

(US$ Billion)

* Manageable operating costs: lifting, refining, logistics and distribution costs, overhead and others

2013 2014 2015 2016ESTIMATE

2017 2018

3333

29

Oil and Gas Production (Million boed)2,54

2,692,79 2,79

Cuts in Capex and Opex did not lower production

—

10

Partnerships and divestments

2017-2018

21

2015-2016

Partnership and divestment program took off

—

Strategic Partnership

with Total

USD 2.2 billion

13,6

49% Gaspetro to Mitsui

Bacia Austral assets to CGG

66,7% PESA to Pampa Energia

Petrobras Chile Distribuición to SCC

66% BM-S-8 (Carcara) to Statoil

90% of Nova Transportadora do

Sudeste to Brookfield

Nansei Seikyu to Taiyo OC

Liquigas to Ultragaz

Partnership with Total

45,97% Guarani to Tereos

Petrochemical Suape and Citepe to Alpek

49% Nova Fronteira to Sao Martinho

Strategic Partnership

with Statoil

USD 2.5 billion11

Strategic Partnership

with Galp

Net debt/Ebitda

15.626

29.619

-25.687-41.828

-19.554

2012 2013 2014 2016 ¹2015

Free cash flow (R$ million)

Indicators are showing a turnaround

—

Investments

Cash flow from operating activities

(1) Data for 2016 until 3Q

5,31

4,1

2,5

3

3,5

4

4,5

5

5,5

1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16

2012 a 2014

-R$ 87.069

2015 a 2016¹

+R$ 45.245

12

0

50

100

150

200

250

300

350

400

450

500

2015 2020 2030 2040

MM

TO

Es

Oil Natural gas Coal Hydro Nuclear Renewables Other

Source: IHS Markit (Scenario)

125 121 134 140

Other: Includes biofuels, solid waste, biomass, and net trade of electricity and heat

Oil and gas will remain the dominant energy sources in Brazil

—

Brazilian Energy Mix

13

Challenges

ahead

—

Geopolitical risks, especially in the Middle East

Uncertainties about Trump’s monetary, trade

and foreign policies

Economic slowdown of Europe and China

Slow economic recovery in Brazil

2017 Top Risks

—

15

In the oil sector, regulation is likely to move towards a more competitive

business environment

—

Improvement in

local content policy

Streamline

environmental licensing

Changes in the

pre-salt law

New calendar

for bid rounds

Better regulatory

framework

New regulation for

the Gas industry

16

Regulatory framework for the Oil&Gas

industry tends to improve

Deleveraging and safety are top priorities for

Petrobras

Key messages—

17

THANK YOU

—Pedro ParentePresident & CEO of Petrobras