Category: Latin America

Venezuela has larger oil reserves than Saudi Arabia. The country only produces 20% of Saudi Arabia’s production level. Venezuela needs higher oil prices for success – this may result in increased production and therefore market supply. Introduction Venezuela is a significant player in the oil markets. The country has several hundred billion barrels worth of oil according to their data, which represents ten years of the world’s production by itself. The country currently has a production of 30.41 million people up from 24.41 million in the year 2000 and 19.74 million in the year 1990. The country’s oil allows it to have a relatively high $14,414.75 GDP per Capita. This compares to $11,208.08 for Brazil and $41,787.47 for the United Kingdom. Reserves Venezuela Oil Holdings – Deep Resource As we can see here, much of the country’s reserves are from the Orinoco Belt in Venezuela. The Orinoco Belt has […]

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Photo Venezuelan oil workers demonstrating against the United States in March. During the boom years of high oil prices, little was done to stop the billions that disappeared through corruption and fraud. Credit Meridith Kohut for The New York Times CARACAS, Venezuela — The weed whackers were $12,300. Each. Then there was the $1.8 million machinery to kill and gut chickens. When the police checked it, they found a worthless jumble of rusted scrap metal. And there were the businessmen who collected $74 million to ship chemicals and other products from abroad — but sent almost nothing in return. For years, Venezuela has had a hole in its pocket, a very big hole. The government’s complex currency system has led to exorbitant schemes by importers, who wildly inflate the value of goods brought into the country to grab American dollars at rock-bottom exchange rates. Sometimes, they fake the shipments […]

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CARACAS—Venezuela’s government, which heavily subsidizes electricity, will start rationing power nationwide as it faces a surge in demand for air conditioning amid a continuing heat wave, officials said Tuesday. The cuts will begin with some public-sector offices where the workday will be reduced to six hours from eight and where power use will be moderated, Vice President Jorge Arreaza said in an address broadcast on state television. He also promised inspections of large private consumers such as malls, hotels and other industries. He blamed the recent surge in power demand on climate change caused by excessive industrialization. “This is of course linked to global warming and the excessive industrialization of capitalism, which never stops, nor has ever stopped, for the effects that it can have on the climate, on society and on Mother Earth,” Mr. Arreaza said. The announcement comes one day after local reports of power outages affecting […]

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Every time Venezuela introduces a new, weaker currency exchange rate, some of the world’s largest companies face the decision of whether or not to adopt it. If they eventually do switch to the less favorable rate, it can result in multimillion-dollar charges that drag down balance sheets and earnings statements. At least 46 S&P 500 companies, about 10 percent of the total index, have told investors about potential exposure to Venezuela’s currency in the past year, according to a search of company filings compiled by Bloomberg. Venezuela currently has three legal  exchange rates  that are pre-set by the government, and companies that operate there have to decide which one they should use to value net monetary assets and report sales. The rates are currently at 6.3, 12 and 196.95 bolivars per dollar. The first two rates (called the Cencoex rate and the Sicad rate) are allowed for transacting government-authorized priority goods including food, medicine and car parts. […]

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ORINOCO BELT, Venezuela (Reuters) – Venezuela has launched talks this month on a novel plan to blend the country’s heavy crude with light oil from other OPEC allies, seeking to create a new variety that can compete against swelling U.S. and Canadian supplies. The proposal, which would expand on a pilot scheme involving Algerian oil last year, envisions supplying refineries built for medium-grade crudes rather than the light oil that has become plentiful as a result of the North American shale boom, said the head of state oil company PDVSA, Eulogio del Pino. Del Pino said he raised the idea during the Summit of the Americas in Panama earlier this month and at a meeting with ambassadors from the Organization of the Petroleum Exporting Countries in Caracas last week. He did not specify how other members had responded or what the next steps would be. The talks suggest that […]

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