Brazil’s state-owned Petroleo Brasileiro SA Petrobras (ADR)(NYSE:PBR) has faced a lot of criticism ranging from corruption dealings to ever increasing debt. The oil company has undertaken operational cost cuts, slashed capital investment and a massive asset divestment program with the aim of managing credit. Petrobras aims to raise $15.8 billion through asset sales, with the target looking very optimistic as the company has only raised $2.1 billion so far.In apositive development in this line, the company is currently looking at proposals to either sell part or all of fuel distribution unit BR Distribuidora SA. The structure of a transaction is expected to be decided within this month.

Petrobras can be said to be not in a good situation. The company currently has $126 billion debt on its books. Given the weak economy in Brazil, massive losses due to corruption and the downturn in theenergy market, managing this kind of debt load is tough. Petrobras publicity is also damaged after its constant accusation of fraud. Its former executivesare accusedof a bribery scheme that resulted in impairment losses to a tune of $17 billion.

 Some Petrobras officials are currently being accused of being bribed by SBM between 1996 and 2012. The Financial Times has also linked the company to Lava Jato corruption investigation. The allegation is linking Petrobras to a political leader.

The current recession in Brazil, which is termed as the worst in adecade is not good for the recovery of the company. According to Economic Cooperation and Development, the recession might continue through 2016 and 2017, as political uncertainties continue to hurt the country’s business environment. Another crucial factor is that the Energy market has been in turmoil since the latter half of 2014. During the worst phase, the price fell towards the mid $20 per barrel range. They have since then recovered to close $47 per barrel but remain lower than pre-downturn level.

New Petrobras CEO Pedro Parente, notes that the government has no plan to sell or privatize Petrobras. The company’s shares were up 2.5% on Monday.