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Conference Call / WebcastRESULTS ANNOUCEMENT2nd Quarter 2008(Brazilian Corporate Law)

Almir Guilherme BarbassaCFO and Investor Relations OfficerAugust, 13th 2008

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Disclaimer

The presentation may contain forecasts about future events. Such forecasts merely reflect the

expectations of the Company's management. Such terms as "anticipate", "believe", "expect",

"forecast", "intend", "plan", "project", "seek", "should", along with similar or analogous expressions, are

used to identify such forecasts. These predictions evidently involve risks and uncertainties, whether

foreseen or not by the Company. Therefore, the future results of operations may differ from current

expectations, and readers must not base their expectations exclusively on the information presented

herein. The Company is not obliged to update the presentation/such forecasts in light of newinformation or future developments.

The United States Securities and Exchange Commission permits oil and gas companies, in their filings

with the SEC, to disclose only proved reserves that a company has demonstrated by actual production or

conclusive formation tests to be economically and legally producible under existing economic and

operating conditions. We use certain terms in this presentation, such as oil and gas resources, thatthe SEC’s guidelines strictly prohibit us from including in filings with the SEC.

CAUTIONARY STATEMENT FOR US INVESTORS

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NATIONAL PRODUCTION OF OIL, NGL & NATURAL GAS – 2Q08 VS 1Q08

1.789 1.816 1.854

269 304 321

2Q07 1Q08 2Q08Oil and NGL Natural Gas

Th

ou

s. b

pd

2,1202,175

2,058

• 2% increase in oil production for the quarter due

to the increase in the production of P-52 and P-54

platforms (Roncador field);

• 6% increase in the natural gas production.

Increase in the production of non-associated

natural gas in the Manati field and in the Espírito

Santo Basin, and increase in the production of

associated natural gas in the new production

units in the Campos Basin;

• June, monthly production record: 1,867 th. bpd .

Unit Production1st Q/08

Production2nd Q/08

Current Production (August, 5)

P-52 52.7 107.9 154.8

P-54 42.7 62.2 96.5

FPSO Vitória 27.9 26.9 31.7

FPSO Rio de Janeiro 59.2 61.0 62.1 Th

ou

san

d b

pd

Oil and Natural Gas Production in Brazil

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Water Depth Operating 2007

Start Up 2008

Start Up 2009

Start Up 2010

Start Up 2011

Start Up 2012

From 2013 to 2017

0-999m 5

• Pride South Atlantic

• O. Yorktown• Pride Mexico • Borgny Dolphin• Ocean Concord• Falcon-100

• Petrobras XIV

1000-1999m 18 Olinda StarOcean Worker

≥ 2000m 5

• Lone Star• Schahin III• Petrorig II• Sevan Driller• West Taurus• West Eminence• Dave Beard

• Gold Star• Schahin I• Norbe VI• Delba III• SSV Victoria• West Orion

•Delba IV

• Delba V• Delba VI• Scorpion• Delba VII• Delba VIII• Norbe IX• Schahin 1• Schahin 2• Norbe VIII• Petroserv • Etesco 8• Sevan Brasil

+ 28 new units to be leased

Total per year 28 6 9 7 1 12 28

Cumulative 6 15 22 23 35 63

NEW DRILLING RIGS

Stena Drillmax e Deep Water Millennium are not being considered since they are being negotiated in the Spot Market

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COMPETITIVE NATIONAL SUPPLY OF GOODS AND SERVICES

imports

imports

Current Demand Future Demand

1. Increase productive capacity of

sectors already highly competitive

2. Develop competition among sectors

with limited competition

3. Incentives for new national entrants

4. Incentives for joint ventures

between national and international

companies

5. Incentives for international

companies to invest in Brazil

National

Industry

PATH

Increase in National Supply Capacity of G&S

Adequacy of The National Supply Industrial Complex

GOOD AND SERVICES SUPPLY

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PRE-SALT – SANTOS BASIN

BM-S-21 (Caramba)

BM-S-8 (Bem-te-Vi)

BM-S-9 (Parati)

BM-S-11(Tupi)

(Guará)

(Yara)

Wells Being Drilled

Wells Drilled

BM-S-9 (Carioca)

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• Increase in the demand for oil products and strong operating performance of the refineries led to increasing throughput of 3% and production of oil products by 4% during the quarter, with 95% utilization rate ;

• 4% increase in oil products sales in Brazil, mainly diesel (8%).

1,79 51,79 6 1,8 0 21,776

1,8 4 6

1,70 3

1,776

1,70 91,76 8 1,76 5

9 58 9

9 1 9 0 8 9

78 7878 79 77

1, 500

1, 650

1, 800

1, 950

2Q07 3Q07 4Q07 1Q08 2Q08

30

40

50

60

70

80

90

Out put of Dome st i c Oi l P r oduc t s S a l e s Vol ume of Tot a l Oi l P r oduc t s

U se of I nst a l l e d C a pa c i t y - B r a z i l ( %) Dome st i c Cr ude ( %) of Tot a l Fe e dst oc k P r oc e sse d

Thous. bpd %

DOWNSTREAM OPERATIONAL PERFORMANCE

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GAS & POWER OPERATIONAL PERFORMANCE

Energy sold in the last auctions

Increase gas supply from E&P

New gas pipelines in operation

New regulatory framework in the electric sector

Next Steps…Completed ActionsMore gas available to be sold or to be used in

thermo generation

Better prices and margins

Higher dispatch in the thermo power plants to guarantee the security of the electric system

Recovery of fixed costs

Reduction in contractual penalties

Hydro

Nuclear

Wind

Coal

Third-parties Thermo generation (oil + gas)

Petrobras Thermo generation (oil + gas)

New contracts with the distribution companies

40.000

42.000

44.000

46.000

48.000

50.000

52.000

jun/07 jan/08 jun/08

MW

ave

rgae

Gas-fired thermo generation growing importance in Brazil

Creating flexibility in the portfolio

Increase LNG regasification capacity

Completing gas infra-structure

Increasing domestic production

More contracts sold in energy auctions

Source: ONS (Brazilian Energy System)

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LIFTING COST IN BRAZIL

• Increase in government take due to higher oil prices and higher taxes from the Roncador field, due to production increases (P-52 and P-54 platforms);

• Increase in lifting cost calculated in Reais due to maintenance (P-26 e P-33) and programmed stoppages (Marlim and Namorado fields) besides cost inflation in the industry;

• In dollar terms, lifting cost also impacted by the FX rate appreciation.

16.3415.1615.2214.6614.45

34.8028.0425.7623.2620.58

0

10

20

30

40

50

60

2Q07 3Q07 4Q07 1Q08 2Q08

Lifting Cost (R$) Gov. Part.(R$)

7.33 7.65 8.60 8.66 9.88

10.62 12.4814.56 16.16

21.20

96.9

121.0

88.774.968.8

0

10

20

30

40

2Q07 3Q07 4Q07 1Q08 2Q080

20

40

60

80

100

120

140

Lifting Cost (US$) Gov.Part. (US$) Brent

US$/barrel R$/barrel

37.9235.03

40.9843.20

51.14

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AVERAGE REALIZATION PRICE – ARP

• Adjustment in diesel (15%) and gasoline (10%) prices in May and Real appreciation in the period contributed to theincrease of ARP in Brazil.;

• Due to higher oil prices (average Brent in the quarter was US$ 121 against US$ 69 in the 2Q07), refining margins werecompressed, following international trend.

2 04 06 08 0

10 012 014 0

Jun- 0 6 Sep- 0 6 D ec- 0 6 M ar- 0 7 Jun- 0 7 Sep- 0 7 D ec- 0 7 M ar- 0 8 Jun - 0 8

A R P B raz i l ( U S$/ b b l) A verag e B rent Pr ice( U S$/ bb l) A R P ( U S$/ b b l wit h V o l . So ld in B R l)

126.03

121,38

107.46

2Q08Average

82.42

69,45

78.23

2Q07Average

US

$/bb

l

1Q08Average

104.79

97,07

93.90

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1,8541,816

NET INCOME CHANGE – R$ MILLION - 1Q08 VS. 2Q08

Oil Production in Brazil (th. bpd)

Result was affected by :

• Increase in gross income: increase in average realization prices (oil and oil products) and volumes sold;

• Decrease in operating expenses: reduced exploratory costs and fines related to natural gas supply;

• Increase in net financial expenses: strong appreciation of the Real in the period;

• Better non-operating result: change in participation in relevant investments in Quattor (R$ 409 MM).

6,925

7,678 3,693

173 1,132 586

5828,783

1Q08 NetIncome

Revenues COGS Oper. Exp. Fin. and nonoper. expenses

Taxes Minority Inter.and Particip. inEquity Incomeand Employee

Part.

2Q08NetIncome

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1,8541,816

EXPLORATION & PRODUCTION – CHANGE IN OPERATING PROFIT– R$ MILLION – 1Q08 VS. 2Q08

Domestic Production of Oil, NGL and Condensate (th.bpd)

• Better operating result in E&P due to the increase in crude oil sales price (22%) and production (2%).

14,496

7434,004 1,237282 40 17,724

1Q08 Oper.

Profit

Price Effect

on revenues

Volume Effect

on revenues

Cost Effect

on average

COGS

Volume Effect

on average

COGS

Operational

expenses

2Q08 Oper.

Profit

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1,8551,779

DOWNSTREAM – CHANGE IN OPERATING PROFIT – R$ MILLION – 1Q08 VS. 2Q08

Oil Products and Alcohol sales in the domestic market (th.bpd)

• Increase in average oil products realization prices (9%) and sale volumes;

• Increase in costs due to higher acquisition prices (oil and oil products), partially offset by liquidation of inventorieswith a lower cost basis purchased during previous quarters (average cost of the inventories methodology);

• World trend of refining margin compression due to the strong increase in oil prices.

(903)

4,5312,400

(577)

4,760

2,283

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Volume Effect on

average COGS

Operational

Expenses

2Q08

Oper. Loss

1Q08 Oper. Loss Volume Effect on

Revenue

Price Effect on

Revenue

Cost Effect

on average COGS

14

166

226

497 25 382

95

INTERNATIONAL – CHANGE IN OPERATING PROFIT – R$ MILLION – 1Q08 VS. 2Q08

• Increase in sales volume and higher sales price of crude oil;

• Decrease in operating expenses due to a reduction in exploratory costs in the USA and Nigeria and absence ofcontingencies related to royalties in Colombia, which occurred in the 1Q08.

International Sales Volume (th. bpd) 631557

2Q08

Oper. Profit

1Q08 Oper. Profit Cost Effect

on average

COGS

Volume Effect

on average

COGS

Operational

Expenses.Volume Effect on

Revenue

Price Effect on

Revenue

627

15

(502)

353

140

452

320

124

265

GAS & POWER – CHANGE IN OPERATING PROFIT – R$ MILLION – 1Q08 VS. 2Q08

Natural Gas Sales Volume (million m3/day)

• Better price for natural gas due to new contracts with distributors;

• Increase in volumes, with higher supply of domestic gas by E&P (3% - 29 million m3/day);

• Higher generation of electric power due to the availability of gas and the new resolution for the sector;

• Less contractual fines related to the supply of natural gas for third parties.

5048

2Q08

Oper. Profit

1Q08 Oper. Loss Cost Effect

On average COGS

Volume Effect on

average COGS

Operational

Expenses.Volume Effect on

Revenue

Price Effect on

Revenue

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CASH FLOW

2Q08 1Q08 2Q07

Net Cash Generated by Operating Activities 11,888 9,771 13,184

(-) Cash used for Capex (10,969) (10,070) (10,236)

(=) Free Cash Flow 919 (299) 2,948

(-) Cash used in Financing Activities (1,433) (1,212) (5,557)

Financing 678 2,862 (3,958)

Dividends (2,111) (4,074) (1,599)

(=) Net Cash Generated in the Period (514) (1,511) (2,609)

Cash at Beginning of Period 11,560 13,071 20,463

Cash at End of Period 11,046 11,560 17,854

R$ million

• Positive Cash Flow generated by operating activities;

• Cash used for dividends payment.

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Petrobras’ Leverage Ratio

R$ million 06/30/2008 03/31/2008 Var

Short Term debt (1) 8,699 7,639 14%

Long Term Debt (1) 33,256 35,674 -7%

Total Debt 41,955 43,313 -3%

Cash and Cash Equivalents 11,046 11,560 -4%

Net Debt (2) 30,909 31,753 -3%

Capital Structure 46% 47% -1 pp

Net Debt/Net Capitalization

21%

19%18%

17%16%

19%19%

Dec-06 Mar-07 Jun-07 Sep-07 Dec-07 Mar-08 Jun-08

LEVERAGE

• Net debt decreased 3% in the 2Q08 when compared to the 1Q08, due to the Real appreciation.

• Net Debt/Net Capitalization decreased 2 p.p. in the same period, falling to 19%.

(1) Includes debt from leasing contracts (R$ 1,202 m illion on June 30, 2008 and R$ 1,429 million on March 31, 2008).

(2) Total Debt – Cash/Cash Equivalents

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QUESTION AND ANSWER SESSIONVisit our website: www.petrobras.com.br/ri

For more information contact:

Petróleo Brasileiro S.A – PETROBRAS

Investor Relations Department

Theodore Helms – Executive Manager

E-mail: petroinvest@petrobras.com.br

Av. República do Chile, 65 – 22o floor

20031-912 – Rio de Janeiro, RJ

(55-21) 3224-1510 / 3224-9947