SALES VOLUME

The volume of sales on the domestic market was 5% higher than in 2007, with an emphasis on diesel, gasoline, aviation kerosene and natural gas. The 6% increase in the sales of diesel reflects the increase in the GDP, the use of emergency diesel powered thermoelectric power stations, the investment in infrastructure works, mining and civil construction, as well as the decrease in the production and imports of other players. The 4% increase in the sales of gasoline was influenced by the increase in the consumption of families and by the smaller share of other players. The 7% increase in the sales of aviation kerosene is a result of the expansion of tourism, the entry of new aircraft and new routes, increasing the number of flights available. The 26% increase in the sales of natural gas results from the sales of non-thermal gas to the distributors in the State of São Paulo and the 150% increase in the sales to the thermal market, caused by the greater offer of gas, mainly due to the increase in production of the Manati field, off the coast of Bahia, and the entry into operation of the Cabiúnas-Vitória and Vitória-Cacimbas gas pipelines.

International sales were 6% lower compared to 2007, due to the stoppages for maintenance in the Pasadena refinery, the sale of the refinery in Bolivia in 2007, a decrease in production in the USA (loss of pressure in Cottonwood and hurricane Ike) and Argentina (mature fields) and a decrease in the volumes of oil and gas sold in Bolivia with the new operating agreements, attenuated by the consolidation of the sales of the refinery in Japan, as from 2Q-2008 and by the start-up of production of petrol in Nigeria in 3Q-2008.