Brazilian President Jair Bolsonaro attends the UAE-Brazil Business Forum
in Abu Dhabi, UAE, October 27, 2019. REUTERS/Satish Kumar/File Photo

Brazil’s president welcomed an informal invitation from Saudi Arabia for his country to join OPEC and said he’d be eager to accept. The Saudi offer highlights Brazil’s growing importance as an oil producer. 

Joining the cartel wouldn’t be straightforward. In past administrations, national oil company Petroleo Brasileiro SA rejected the idea, arguing that it has obligations to its investors and debt holders, and that the government doesn’t have power to determine production levels of private operators.

Experts see Brazil as one of the few areas in the world with vast amounts of untapped, low-cost oil open to private investors, unlike the Middle East which is dominated by nationalized entities.

Brazil’s burgeoning production runs counter to OPEC’s effort to reduce crude supply and prop up crude prices in the face of booming supply from U.S. shale fields and weakening global demand. If it joined, Brazil could become OPEC’s third-biggest producer after Saudi Arabia and Iraq.