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June's 1.5 percent year-on-year oil and gas output increase at Brazil's state-run oil company Petroleo Brasileiro SA was a disappointment, jeopardizing its goal of producing 7.5 percent more oil and gas a day at the end of 2014 compared with the end of 2013, Santander Investment Securities analysts Christian Audi and Gustavo Allevato said in a client note distributed on Monday.
Despite the weak result, Audi and Allevato expect the company's share price to be driven by the outlook for Brazil's October presidential elections rather than operational results. The share price of Petrobras, as the company is known, is more likely to gain with expectation that an opposition candidate will defeat incumbent President Dilma Rousseff and more likely to fall as the leftist's chances increase, they wrote. (Editing by Diane Craft)