Brazil's Petrobras has discovered the largest light crude Oil Field since the Mexican Cantarell Field in 1976. The massive find is in the same area off the coast of Brazil as the restly discovered Tupi field which is beleived to hold 8 billion barrels of extractable crude. The new Sugar Loaf Field discovery is 5 times larger than Tupi and could signal an end to declining oil production around the World.

According to officials at Petrobras, Brazil's state-run oil and gas company, the Sugar Loaf field may produce up to 40 billion barrels of oil. Several multinational petroleum companies are already lining up to explore the region, including Petrobras, Royal Dutch Shell and ExxonMobil.

The basin is believed to contain light crude, an added bonus for Brazil considering it still depends on other countries to refine oil for its domestic needs.

"To discovery oil is one thing, but to discover light crude is a real commodity," said one analyst.

Preliminary exploration of the area has determined that the Sugar Loaf field is five times the size of the Tupi field, already considered a major boon for South America's largest economy.

Last month Petrobras officials said the discovery in the Tupi oil field could launch Brazil into the top 10 oil producers in the world. The oil field's potential yield would provide Brazil with the world's eighth-largest oil and gas reserves, Petrobras President Sergio Gabrielli said.

Elated by the discovery, President Luiz Inacio Lula da Silva quipped, "God must be Brazilian."

News of the discovery prompted Petrobras shares to jump more than $24 on the New York Stock Exchange to $116.77, a 52-week high at the time.

The find follows last year's announcement that Brazil has become a net exporter of oil after decades of dependence on other countries. However, Brazil still imports light crude for use domestically.

Brazil experienced a record year in petroleum production in 2006 with Petrobras reporting record-high oil processing levels in its refineries.

The company reported that a total of 1.784 million barrels per day were processed in Brazilian refineries in 2006, a 1.5 percent increase from 2005 production levels.

The state firm said the increase in production was the result of improved production and supply chain management, ranging from raw material flow to the delivery of oil derivatives to customers.

Petrobras also noted earlier this year it was in the final stage of construction and installation of its $900 million P-54 platform, one of the world's largest, with a production capacity of 180,000 bpd and capable of compressing 6 million cubic meters of natural gas per day.

The P-54 will be installed in the Roncador field, in Campos Basin, Rio de Janeiro, not far from the Tupi and Sugar Loaf basins.

Brazil's recent good fortune in the oil business could mean a much higher profile for a country that considers itself the de facto leader in the region.

"If it (Sugar Loaf) is proven to be as big as everyone says, it would definitely put Brazil among the biggest in the global oil market," noted Roger Tissot, an analyst with PFC Energy.