Source: Andreas Fink, Wikimedia Commons The Brazilian growth story is going up in smoke. For years, Brazil's government leaned heavily on Petrobras [its mostly state-run energy company] to pay for massive government spending programs, including fuel subsidies, banking on its massive resource potential to cover its reckless spending. Most of Brazil's oil reserves are offshore, with some estimates calling for 50 billion barrels of crude in place. At the beginning of 2014, the EIA forecasted that Brazil had 13.2 billion barrels of proven oil reserves [with room for exploration and appraisal upside]. However, low oil prices, delayed/ canceled projects, and a massive corruption scandal have put a huge wrench in Brazil's energy-weighted growth ambitions. Petrobras' debt load now sits at $135 billion [and presumably growing], while Brazilian President Dilma Rousseff's approval rating continues to tread water at all-time lows in light of the Petrobras scandal and due to protests over the enormous amount of money Brazil is spending [and has spent] on building stadiums and infrastructure in order to host the FIFA World Cup in 2014 and the Olympics in 2016. Rousseff was the chairwoman of Petrobras during much of what could be a $22 billion scandal involving bribery, price-fixing, mismanagement, and political kickbacks, with Brazil's federal government still attempting to get a grasp on the true extent of the Petrobras scandal. Petrobras' new leader, Aldemir Bendine, is a close ally of Rousseff's, which means major change at the company remains unlikely for now. Some politicians that previously supported Brazil taking the lion's share of its oil wealth through statist policies [offering lackluster opportunities for more efficient, foreign upstream and downstream players, thus hampering growth and overall prosperity] are beginning to realize that Brazil needs to open up its energy sector and provide better economic incentives so foreign investment can flow into the country to revive growth, create jobs, and help boost wages as Brazil's inflation rate climbs over 8%. I wouldn't expect much to change until there is a shift in political direction in Brazil, and even after the recent rally in Petrobras' stock price [now at $8.70 a share], it still remains a far cry away from where it was six months ago and I wouldn't recommend investing in the company. There are much better energy companies to invest in with better growth prospects and far less corruption, like ConocoPhillips. Disclosure: The author, Callum Turcan, does not own any of the companies mentioned above. Always do your own due diligence before investing.