The company, with $1.75 billion in outstanding senior notes and convertible bonds, had been negotiating with lenders to reopen credit lines needed to maintain operations and meet its financial obligations.
But on Tuesday it said its board of directors had "resolved to prepare for a filing for insolvency or composition proceedings in Switzerland and will make the necessary filings as soon as possible".
It added that "similar steps are being taken by Petroplus subsidiaries in various jurisdictions".
CEO Jean-Paul Vettier said: "It is unfortunate to have reached the point where the executive committee and board of directors have to inform our employees, shareholders, bondholders and other stakeholders about these circumstances."
"We have worked hard to avoid this outcome, but were ultimately not able to come to an agreement with our lenders to resolve these issues given the very tight and difficult European credit and refining markets.
"We are fully aware of the impact that this will have on our workforce, their families and the communities where we have operated our businesses."
On Monday trading in Petroplus shares was suspended at the request of the company, the Swiss exchange said.
A week earlier credit ratings agency Standard and Poor's had downgraded its rating for Petroplus by three notches due to the increased risk of a default on its short-term debt.
Last week Petroplus, Europe's largest independent oil refiner, announced it was to sell its Petit Couronne refinery in France due to the financial difficulties.
Petroplus also said it was looking for strategic alternatives including the sale of its Cressier (Switzerland) and Antwerp (Belgium) refineries.
It has two other refineries across Europe: Ingolstadt in Germany and Coryton in Britain.