Since posting a low in March not visited in more than a dozen years, American depositary shares in Petroleo Brasileiro S.A. (NYSE: PBR) had doubled by early May, though it has pulled back since reporting first-quarter earnings last Friday. Shares traded down about 4% Tuesday morning, after dropping 2% on Monday.

The strong reaction to earnings has been tempered by a nearly equally strong reaction to Monday’s announcement that Petrobras, as the company is known, will issue another $1 billion in debt, pushing its debt burden to around $130 billion. Even for an oil company, that is a mountain of debt. Exxon, which has a market cap about six times that of Petrobras, carries about $33 billion in debt, and Chevron, more than three times the size of Petrobras, lists debt at around $34 billion.

Regardless of the size of the company’s debt, Petrobras has always been able to find willing lenders because yields on the debt are relatively strong, and the debt is backed by billions of barrels of oil. Still, debt service in 2015 is expected to cost the company about $21 billion and cash flow for the year is pegged at around $25 billion, according to a report at The Wall Street Journal. Add in planned 2015 capital expenditures of $29 billion, and a lot more borrowing appears likely.

Goldman Sachs downgraded the stock on Monday from Neutral to Sell and noted that the share price could be cut in half. Lower crude oil prices and lower growth forecast combine to make Goldman’s analysts wary of Petrobras’s leverage.

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Another thing to keep in mind is that first-quarter results from Petrobras were primarily due to a government-authorized increase in the amount the company is allowed to charge for its refined products and to the lower costs Petrobras had to pay for its imported crude oil. Lower costs and higher production also helped as did a strengthening of the country’s currency.

But can investors trust that the stars will always align so happily for Petrobras? Not for now at least. The company’s American depositary shares traded down about 4.5% Tuesday morning, at $9.26 in a 52-week range of $4.90 to $20.94.

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