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Venezuela Oil Price Tumbles Below $40

Venezuela’s weekly oil basket price fell further back below $40 as oil prices around the world slipped and as the crucial U.S. market remained well supplied. According to figures released by the Venezuela Ministry of Energy and Petroleum, the average price of Venezuelan crude sold by Petroleos de Venezuela S.A. (PDVSA) during the week ending October 30 was $38.64, down 83 cents from the previous week’s $39.47, when it had tumbled $2.02. WTI in New York averaged $44.76 — down $1.24 — for the week, while Brent crude traded in London averaged $48.04 — down 70 cents from the previous week. According to Venezuelan government figures, the average price in 2015 for Venezuela’s mix of heavy and medium crude is now $46.93 for the year. Venezuela’s average oil price for 2014 was $88.42, down from 2013’s $98.08, 2012’s $103.42 and 2011’s $101.06, but higher than 2010’s $72.43, and much […]

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Venezuela is running out of cash

China ends one-child policy Venezuela is running out of money fast and has started selling its gold. The cash-strapped country could default by next year when lots of debt payments are due. Venezuela’s reserves, which are mostly made up of gold, have fallen sharply this year as the country needs cash to pay off debt and tries to maintain its social welfare programs. Venezuela owes about $15.8 billion in debt payments between now and the end of 2016. But it doesn’t have enough to make good on its payments. Venezuela only has $15.2 billion in foreign reserves — the lowest amount since 2003. A lot of those reserves are in gold. Less than $1 billion of Venezuela’s reserves are in cash, and it has a couple billion in reserves at the IMF. Its government won’t say how much gold it currently has. In May, Venezuela had $11.7 billion — […]

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How A Lone Oil Rig Embodies the Brazil Boom That Never Was

Oil majors had big plans for Brazil, but you can’t tell by looking at the country’s offshore drilling these days. After crude was first struck in the pre-salt formation in the seas off Rio de Janeiro, producers including BP Plc and Total SA were ready to flock to Brazil with billions of dollars in investments. For the country, it appeared to augur an unprecedented era of oil bounty. Nine years later, the promise remains unrealized: Spain’s Repsol SA and China Petrochemical Corp. are the only foreigners operating an offshore drilling rig. So what happened? While the crude-price collapse and an ongoing graft probe are part of the story, Brazilian officials who failed to auction enough exploration licenses and slowed approvals with miles of red tape were also major contributors to the boom that never came to be, according to Joao Carlos de Luca, a member of the IBP lobby […]

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Algeria Backs Venezuela on OPEC, Non-OPEC Summit to Boost Prices

Algeria supports Venezuela’s call for a summit among heads of state from OPEC and other oil-exporting nations in a bid to lift crude prices, Algerian Foreign Minister Ramtane Lamamra said. ”Algeria has always been a pioneer when it comes to strengthening solidarity between producing countries,” Lamamra said Monday in an interview in Paris after meeting President Francois Hollande. “We would only convene a summit if its success is guaranteed; meetings at the level of ministers and experts will therefore precede such an event.” Venezuela has proposed that heads of state from the Organization of Petroleum Exporting Countries and other oil producers meet in November to discuss the price needed to sustain investments in future supplies, the country’s Oil Minister Eulogio del Pino said on Oct. 21. Speaking in Vienna during a meeting of experts from OPEC and from outside the group, del Pino said Venezuela seeks to set an […]

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U.S. Investigates Venezuelan Oil Giant

WASHINGTON—The directors of one of Spain’s leading construction companies were delighted to land an appointment with Rafael Ramírez, the president of Petróleos de Venezuela, to talk about their plans to bid on a $1.5 billion electric-power project for the Venezuelan state oil giant. But when they showed up at the JW Marriott Hotel in Caracas, it was Mr. Ramírez’s cousin, Diego Salazar, who received them in the presidential suite, say two people who attended the 2006 meeting. Mr. Salazar got right to the point, they say: The Spaniards would have to pay at least $150 million in kickbacks to be in the running. “If not,” Mr. Salazar told the businessmen, according to one person, “you should return to the airport.” The executives didn’t bite. But plenty of other vendors were willing to play along on PdVSA projects, say people who worked with the company before Mr. Ramírez’s departure last […]

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Cuba To Drill For Oil In Deep Water Despite Low Prices

Cuba plans to drill exploratory deepwater wells in the Gulf of Mexico by the end of 2016 or beginning of 2017 despite current low oil prices, officials from the state oil monopoly say. CAMARIOCA, Cuba, Oct 21 (Reuters) – Cuba plans to drill exploratory deepwater wells in the Gulf of Mexico by the end of 2016 or beginning of 2017 despite current low oil prices, officials from the state oil monopoly said. Cuba-Petroleo (Cupet) will drill exploratory wells as deep as 7,000 meters (223,000 ft) in waters of up to 3,000 meters in production sharing contracts with Venezuelan state oil company PDVSA and Angola’s Sonangol. "We will initiate a drilling campaign at the end of 2016 or the start of 2017," Osvaldo Lopez, Cupet’s head of exploration, told Reuters on Wednesday. "The essential goal of the new drilling campaign is at least two deep wells. There could be three. […]

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Venezuelan government sets $40/b target price for oil in 2016 budget

Venezuela has set a target price of $40/barrel for its export basket of crude and products for 2016, Minister of Economy, Finance and Public Bank Rodolfo Marco Torres said Tuesday at a presentation of the national budget for next year. The 2016 target price compares to the $60/b target the Venezuelan government put in place for the country’s 2015 budget. "Excess oil supply has resulted in the sustained fall in oil prices," Torres said. "Considering the trends in the international oil market, the 2016 budget has been estimated [at] an average export price of the Venezuelan oil basket [of] $40/b," Torres said. Venezuela has seen its income from oil exports fall by 50% due to the sharp decline in global oil prices. Article continues below… Oilgram News brings you fast-breaking global petroleum and gas news on and including: Industry players, upstream and downstream markets, refineries, midstream transportation and financial […]

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Venezuela to Keep Making International Debt Payments, Govt Says

Venezuela not only has the funds needed to make payments to bond investors due this month and next, but intends to keep making timely payments on its obligations, Finance Minister Rodolfo Marco Torres said Tuesday. “The government will continue faithfully honoring national and international debt commitments, demonstrating the solidity and reliability of the Venezuelan state,” he said during his presentation of the 2016 budget and debt bills to the National Assembly broadcast on state television. Venezuela has the roughly $3.5 billion ready to make the principal and interest payments due on its Petrobono 2015 this month and the PDVSA 2017 bond next month, Marco Torres, who is also economy vice president, said. Venezuela’s debt composition at year-end 2014 stood at 68 percent domestic and 32 percent international, he said, and by year-end 2015, the country will have made $13 billion in debt payments. Marco Torres was said to have […]

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Venezuela Foreign Reserves Fall to 12-Year Low as Payments Loom

Venezuela’s international reserves fell to a 12-year low of $15.3 billion as the South American country faces payments on its dollar debt totaling $4.5 billion in October and November. Reserves fell $614 million on Oct. 16, the central bank said Monday on its website. That’s the lowest level since May 2003 and the biggest daily decline since June 3, according to data compiled by Bloomberg. The country, which has seen dollar revenue decline with oil prices, and its state-owned oil company, Petroleos de Venezuela SA, have principal and interest payments of $1.5 billion due this month and another $3 billion in November, according to data compiled by Bloomberg. The government will likely be able to pay its debt due this year, although there’s a 60 percent chance of default next year, Eurasia Group said Monday. “While Eurasia Group continues to expect Venezuela to service its debt in 2015, a […]

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Venezuela’s Leaders Prepare for a Risky Election

Venezuelan President Nicolas Maduro speaks on national television in Caracas, Oct. 6. (JUAN BARRETO/AFP Photo/Getty Images) A political turnover could be in store for Venezuela, and the country’s leaders are doing their best to prepare for it. The Dec. 6 parliamentary elections are less than two months away, and the ruling United Socialist Party of Venezuela (PSUV) stands a good chance of losing its legislative majority. Faced with the possible erosion of their political power, the party’s key figures are taking steps to secure their own futures. Click here to continue reading… Stratfor provides global awareness and guidance to individuals, governments and businesses around the world. We use a unique, intel-based approach to analyze world affairs. Copyright © 2015 Stratfor Global Intelligence, All rights reserved. Our mailing address is: 221 West 6th Street Suite 400 – Austin, TX 78701, USA unsubscribe from this list update subscription preferences | forward […]

Posted On : Published By : Tom Whipple