Booming Brazil could be world power soon

Recent report of huge oil field puts once-struggling nation in the spotlight

	Workers build a bridge in Sao Paulo. Brazil is in overdrive with test drilling at a potentially mammoth offshore oil field, ports jammed with soy shipments for China, biofuel production galore and plenty of cash for big infrastructure projects.
Andre Penner / AP

updated 5:37 p.m. ET April 17, 2008

SAO PAULO, Brazil - Brazil's booming economy is shifting into overdrive, with biofuels and deep-water oil providing energy independence and the government collecting enough cash to irrigate the desert and pave highways across the Amazon.

The country's currency is strong, its exports are booming and its foreign debt is gone. The economy is growing at more than 5 percent a year and millions of people with new access to credit are buying homes and cars. Topping off all the good news, an energy official said this week that a newly discovered oil field could be the world's third-largest.

For decades, Brazilians have felt their once-backward nation deserved a starring role on the world stage. Now it may be getting one.

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"Brazil is finding its place in the world," said Luiz Barboso, wearing a hardhat as he helped supervise 500 workers on a towering, $76 million bridge complex in Sao Paulo, the nation's capital of industry and finance. "It's great for the people, and it means more work and more money."

Of course, Brazil is grappling with giant problems firmly rooted in the developing world, including enduring poverty, urban violence and widespread political corruption. But Monday's news provided hope that a new prosperity could begin to address those issues.

Brazil's top oil industry regulator, Haroldo Lima, told reporters that a field off the coast of Rio de Janeiro could contain 33 billion barrels of oil. That would be bigger than any oil find in decades, and would triple Brazil's oil reserves.

The state-run oil company Petroleo Brasileiro SA cautioned that offshore oil deposits are notoriously hard to measure, let alone extract. But investors betting on a mother lode sent Petrobras stock up nearly 10 percent in a day.

"We're already doing well, and if I look ahead, I think it will only get better," said Antonio Bonchristiano, the Brazilian co-chief of GP Investments, Latin America's largest private equity firm. He spoke this week at an economic forum in Cancun, Mexico, where excited investors compared notes on Brazil's potential.

The U.S. ambassador to Brazil, Clifford Sobel, said there's no end in sight because Brazil appears to have left its boom-and-bust economic cycles behind.

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Brazil thinks it has found massive oil field

"As long as they have the ability to have a stable environment where people can make long-term, secure investments, and as long as commodities ... are strong in the global arena, Brazil will continue to grow and prosper," he told The Associated Press.

And this boom could translate into power beyond the economic realm.

CONTINUED: 'A a major petroleum power'

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