RIO DE JANEIRO (AP) -- The oil company of Brazil's one-time richest man filed for bankruptcy protection Wednesday, marking a humbling blow for Eike Batista, a flamboyant former champion speedboat racer who has been his nation's biggest economic cheerleader in recent years.
Brazilians and analysts alike struggled to understand the rise and fall of Batista, who largely bankrolled Rio's winning bid to host the 2016 Olympics, and whether it could be linked to Brazil's own economic sluggishness of the past three years.
Some said the story of Batista's failure to deliver on producing offshore oil and resulting inability to obtain more investor credit was a byproduct of bad luck and a toughening overall economic environment.
Others feared it's just the latest sign that Brazil won't soon see an end to its economic slide.
"What's the phrase? When the tide goes out, you can see the man who is not wearing a bathing suit?" said Jefferson Finch, a Latin America analyst with the New York-based consulting firm Eurasia Group. "That's what's happened with Eike Batista."
Finch said that "investor enthusiasm started turning on Brazil around 2011" after five years of high hopes South America's biggest nation had finally turned a corner and would make good on its longtime promise to become a perennial power with repeated years of strong growth.
"But if you look at the overall context, Brazil was never as promising as people said it was in 2006, when a lot of commentators were effervescent on Brazil, ignoring the structural challenges it faced," he said. "Now, Brazil is not as bad as all the negative commentary."
Among the indicators that Brazil is heading in the right direction, Finch pointed to the government's slow but steady efforts to boost infrastructure investment, push tax reform and send tens of thousands of college science students abroad to get better training to eventually fill a gap in skilled labor.
But with economic growth of just 0.9 percent last year, a long fall from the 7.5 percent growth seen in 2010 amid a global financial crisis, others expressed doubts.
"The entire thing has had a really negative impact on Brazil's image and reinforces the need for stronger corporate governance in this country," said Cassia Pontes, an oil industry analyst with the Rio-based Lopes Filho consulting firm. "Reality didn't live up to the exaggerated expectations created by Batista."
OGX, created in 2007, didn't deliver on its promises to produce significant amounts of offshore oil even though it reported many finds since 2010, when its market-value reached $34 billion. In the first half of this year, the company averaged output of just 8,500 barrels a day and racked up more than $2.5 billion in losses.
Critics contend Batista lied to investors, citing a correction made earlier this month for a promising OGX offshore field. In 2012, OGX said the field held nearly 1 billion barrels, but a few weeks ago it lowered that projection to 285 million barrels, too late for those who plowed cash into buying the company's stock.
Miriam Leitao, one of Brazil's top economic columnists, wrote on her blog for the O Globo newspaper Wednesday that Batista's "main error was to declare that he had what he didn't, to mislead the investor."
"Today, it's easy to see the entrepreneur's errors," Leitao wrote. "But earlier it was, too. He's always exaggerated the potential of his companies and thus increased his stock. ... He built a house of cards."
In filing for bankruptcy protection before a Rio de Janeiro state court, Batista's OGX Petroleo e Gas Participacoes SA, part of his EBX Group conglomerate, now has 60 days to come up with a restructuring plan. Investors holding $3.6 billion in debt will then have 180 days to accept or reject the plan. If it's not accepted, the company will be liquidated.
OGX is the backbone of a Batista empire that also includes steel, mining, infrastructure and real estate companies. All are struggling as Batista has come up short on his bet that he could deliver riches with offshore oil finds.
Batista was in talks for months with OGX's creditors, but earlier this month the company missed a $45 million interest payment on the bonds and hopes of working out a deal evaporated.
OGX reported on its website that it needs $250 million "to satisfy near-term liquidity through the first quarter of 2014." The company said that if the restructuring plan isn't accepted, and with no new funding, it will run out of cash before year's end.