In the Amazon, deforestation is retreating but drilling is advancing

For the first time in years, news comes from the Amazon that doesn’t just talk about fires, illegal loggers or pastures torn away from the forest. According to a new report from the MapBiomas monitoring network, in 2025 deforestation in Brazil decreased by 20.6% compared to the previous year, falling below the threshold of one million hectares destroyed. In the Brazilian Amazon, deforestation has reached its lowest level since 2019. A political result, even before an environmental one. Because Luiz Inácio Lula da Silva had built part of his political comeback on the promise of bringing Brazil back into international climate diplomacy after the years of Jair Bolsonaro, marked by the weakening of environmental controls and the advance of the extractive economy in the forest.

But just as deforestation data improves, the Brazilian government is relaunching oil drilling in the heart of the Amazon. Petrobras has announced investments of around $500 million in the Urucu field, in the state of Amazonas, with 22 new wells planned after almost ten years of stoppage.

The Brazilian laboratory

The contradiction is all here: Brazil tries to present itself as a green power without giving up fossil fuels. And perhaps it is precisely this ambiguity that explains the phase that many emerging economies are going through better than any slogan. Lula openly defends this line. “We want to live well, work well and enjoy life. And this will only happen if the economy grows,” he declared during the announcement of the Petrobras plan, claiming the role of oil as a lever to finance the energy transition. For Lula, oil revenues can finance Brazil’s drive towards the energy transition: batteries, critical minerals, green fertilizers and electric mobility.

At the same time, the Brasilia government launched a public-private program worth around 8.5 billion euros to strengthen the industrial supply chain linked to the energy transition. Yet, on a climate level, continuing to invest in fossil fuels while promising the ecological transition remains an increasingly difficult balance to sustain.

The tipping point of the forest

The Amazon remains one of the crucial ecosystems for global climate balances. It covers approximately six million square kilometers distributed across nine South American countries and stores over 120 billion tons of carbon. For years, however, scientific studies and international organizations have warned that large areas of the forest are losing their ability to absorb CO2 due to rising temperatures and the fragmentation of ecosystems. The threshold feared by scientists is that of the so-called “point of no return”: the moment in which the tropical forest could progressively transform into savannah, altering rainfall, biodiversity and climate stability of the entire South American continent.

This is why the announcement of new oil wells immediately reignited criticism from environmental organizations. The Brazilian Climate Observatory has called for “avoiding any form of environmental degradation”, arguing that the Amazon should remain excluded from fossil exploitation.

The new green geopolitics

However, it is not just the environment that is on the table. There is also the geopolitics of energy. International tensions around the Strait of Hormuz, through which a significant share of the world’s oil passes, are pushing many countries to strengthen energy autonomy and internal production. Brazil sees a strategic space: to simultaneously become an exporter of raw materials for the ecological transition and a competitive energy producer. A position that could strengthen the country’s international weight in the coming years, also in view of the presidential elections in October. However, a political question remains even before an environmental one: how long can the balance between protection of the Amazon and new oil expansion hold? For now Lula tries to keep both paths together. The data on deforestation offers him a strong argument on the international level. Drilling, on the other hand, serves to reassure industry, investors and the poorest areas of the country. But the risk is that Brazil ends up chasing two incompatible models: that of global climate power and that of the traditional fossil economy. And the Amazon, once again, remains the place where this contradiction becomes impossible to hide.