This excerpt taken from the PBR 6-K filed Aug 14, 2006.
The increase in consolidated net income in the 1H-2006 was mainly due to the realization of higher domestic and international market prices, as well as other factors detailed below:
These reductions in expenses were partially offset by the following increases:
Financial income increased R$ 1.140 million as a result of the following factors:
Non-operating expenses declined with platforms idleness (R$ 126 million).
Higher income tax and social contribution expense in the 1H06 resulted from the effect of the provisioning of Interest on own capital in June 2005, which improved 1H05 profitability in R$ 746 million.
Net income for the 2Q-2006 increased 4% when compared to the 1Q-2006, reaching R$ 6,959 million. The principal explanation for the variation between 1Q-2006 and 2Q-2006 was the increase in average prices of oil and oil products in the domestic and international markets, largely offset by a reduction in exported volumes and an increase in average unit costs (due to generally higher costs throughout the oil industry). The table below details the variations: