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Venezuelan oil diplomacy curbed by economic crisis

he late President Hugo Chavez’s dream of leveraging Venezuela’s oil wealth to spread revolution across Latin America is crumbling under the weight of an economic crisis that is forcing his hand-picked successor to cut back on generous foreign aid. Signs of the country’s waning influence are becoming more apparent. In early November, Guatemala withdrew from the Petrocaribe oil alliance launched by Chavez, saying it didn’t receive the ultra-low financing rates it had been promised by Venezuela when it first sought to join the 18-nation pact in 2008. Also in recent weeks, representatives of Brazil and Colombia have held meetings with their Venezuelan counterparts to collect overdue payment for food, manufactured goods and other imports. While Venezuela has fallen behind on payments before, the latest cash crunch is more severe, and the economic outlook more uncertain, than any time in 15 years of socialist […]

Posted On : Published By : Tom Whipple
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Venezuela's Maduro Pledges Crackdown Against Foreign-Exchange Speculation

Venezuelan President Nicolas Maduro on Friday promised to intensify his crusade against alleged speculators and greedy businesses which he says are contributing to the oil-rich country’s economic troubles and pledged more state control over sectors fueling sky-high inflation. The leader unveiled a new price cap for commercial real estate and also appointed a few of his cabinet members to run a recently created state agency that will oversee all of Venezuela imports and exports, as well as access to dollars in a country that has had tight currency controls for the last decade. They are the latest measures by Mr. Maduro as he tries to tame an inflation rate well above 50%, rapid depreciation of the local bolivar currency and a shortage of dollars in the import-dependent economy, which has resulted in shortages of food and consumer goods. Regional elections on Dec. 8 are adding pressure […]

Posted On : Published By : Tom Whipple
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Venezuela’s Maduro Pledges Crackdown Against Foreign-Exchange Speculation

Venezuelan President Nicolas Maduro on Friday promised to intensify his crusade against alleged speculators and greedy businesses which he says are contributing to the oil-rich country’s economic troubles and pledged more state control over sectors fueling sky-high inflation. The leader unveiled a new price cap for commercial real estate and also appointed a few of his cabinet members to run a recently created state agency that will oversee all of Venezuela imports and exports, as well as access to dollars in a country that has had tight currency controls for the last decade. They are the latest measures by Mr. Maduro as he tries to tame an inflation rate well above 50%, rapid depreciation of the local bolivar currency and a shortage of dollars in the import-dependent economy, which has resulted in shortages of food and consumer goods. Regional elections on Dec. 8 are adding pressure […]

Posted On : Published By : Tom Whipple
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Venezuela’s Maduro vows stricter business inspections

Venezuela’s President Nicolas Maduro said a stricter wave of inspections for suspected price-gouging would begin on Saturday in an aggressive pre-election "economic offensive" aimed at taming the highest inflation in the Americas. "We’re not joking, we’re defending the rights of the majority, their economic freedom," Maduro said on Friday, alleging price irregularities were found in nearly 99 percent of 1,705 businesses inspected so far this month. Maduro, who has staked his presidency on preserving the legacy of late socialist leader Hugo Chavez, launched a theatrical – and often televised – wave of inspections this month to force companies to reduce prices. He says "capitalist parasites" are trying to wreck Venezuela’s economy and force him from office. Opponents scoff at the measures as cheap and short-term populism that is hiding the failure of Venezuela’s socialist economic model and intended to win votes at an upcoming poll. Economic […]

Posted On : Published By : Tom Whipple
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Venezuela's Maduro vows stricter business inspections

Venezuela’s President Nicolas Maduro said a stricter wave of inspections for suspected price-gouging would begin on Saturday in an aggressive pre-election "economic offensive" aimed at taming the highest inflation in the Americas. "We’re not joking, we’re defending the rights of the majority, their economic freedom," Maduro said on Friday, alleging price irregularities were found in nearly 99 percent of 1,705 businesses inspected so far this month. Maduro, who has staked his presidency on preserving the legacy of late socialist leader Hugo Chavez, launched a theatrical – and often televised – wave of inspections this month to force companies to reduce prices. He says "capitalist parasites" are trying to wreck Venezuela’s economy and force him from office. Opponents scoff at the measures as cheap and short-term populism that is hiding the failure of Venezuela’s socialist economic model and intended to win votes at an upcoming poll. Economic […]

Posted On : Published By : Tom Whipple
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Venezuela Says OPEC Must Accommodate Iran Supply, Maintain Output Cap

Members of the Organization of Petroleum Exporting Countries will have to accommodate any additional oil supply into the market in light of the recent easing of economic sanctions on Iran without changes to the cartel’s overall production ceiling, Venezuela Oil Minister Rafael Ramirez said Thursday. Mr. Ramirez said how Iranian crude is absorbed into the market will feature highly in discussions next week when OPEC members gather. Venezuela will push to maintain the group’s 30-million-barrels-a-day quota, the minister said. The U.S. and five other world powers reached an agreement on Sunday in Geneva to relieve some penalties on Iran in exchange for moves to cap the Islamic government’s nuclear program. “If this permits Iran to reach its maximum oil production, perfect. Then its production quota is guaranteed in OPEC, which must be respected, and we are going to back that [Iran’s] normalization is respected,” Mr. Ramirez […]

Posted On : Published By : Tom Whipple
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Raízen breaks ground on Iogen cellulosic ethanol facility in Brazil

Raízen breaks ground on Iogen cellulosic ethanol facility in Brazil Iogen Corporation announced that Brazilian ethanol giant Raízen Energia Participações S/A has started construction of a commercial biomass-to-ethanol facility using Iogen Energy’s advanced cellulosic biofuel technology. (Iogen Energy is a joint venture between Raízen and Iogen Corporation. Earlier post .) The $100-million plant, to be located adjacent to Raízen’s Costa Pinto sugar cane mill in Piracicaba, São Paulo, will produce 40 million liters (10.6 million gallons US) of cellulosic ethanol a year from sugarcane bagasse and straw. Plant start-up is anticipated in the fourth quarter of 2014. Iogen will provide cellulosic ethanol related process technology, process designs and start-up and operational […]

Posted On : Published By : Tom Whipple
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How China took control of an OPEC country’s oil

China’s aggressive quest for foreign oil has reached a new milestone, according to records reviewed by Reuters: near monopoly control of crude exports from an OPEC nation, Ecuador. Last November, Marco Calvopiña, the general manager of Ecuador’s state oil company PetroEcuador, was dispatched to China to help secure $2 billion in financing for his government. Negotiations, which included committing to sell millions of barrels of Ecuador’s oil to Chinese state-run firms through 2020, dragged on for days. Calvopiña grew anxious and threatened to leave. "If the Phase III transaction documents are not signed in the coming days, then I cannot remain in Beijing," he wrote in a confidential letter to China Development Bank (CDB), reviewed by Reuters. In reality, Calvopiña had little choice but to wait. Shunned by most lenders since a $3.2 billion debt default in 2008, Ecuador now relies heavily on Chinese funds, […]

Posted On : Published By : Tom Whipple
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How China took control of an OPEC country's oil

China’s aggressive quest for foreign oil has reached a new milestone, according to records reviewed by Reuters: near monopoly control of crude exports from an OPEC nation, Ecuador. Last November, Marco Calvopiña, the general manager of Ecuador’s state oil company PetroEcuador, was dispatched to China to help secure $2 billion in financing for his government. Negotiations, which included committing to sell millions of barrels of Ecuador’s oil to Chinese state-run firms through 2020, dragged on for days. Calvopiña grew anxious and threatened to leave. "If the Phase III transaction documents are not signed in the coming days, then I cannot remain in Beijing," he wrote in a confidential letter to China Development Bank (CDB), reviewed by Reuters. In reality, Calvopiña had little choice but to wait. Shunned by most lenders since a $3.2 billion debt default in 2008, Ecuador now relies heavily on Chinese funds, […]

Posted On : Published By : Tom Whipple
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Argentina nears deal with Spanish group Repsol over YPF seizure

Argentina is close to striking a deal with Spanish oil group Repsol to compensate the company for the nationalisation of its YPF unit last year which prompted a diplomatic crisis between Buenos Aires and Madrid. A delegation from Spain, including José Manuel Soria, industry minister, and several executives from Repsol , met Argentine officials in Buenos Aires on Monday to reach a preliminary agreement over compensation for the Spanish company, people close to the talks said. Repsol said in a statement on Monday night that it had noted the agreement between the governments and would consider its value to its shareholders ahead of a board meeting scheduled for Wednesday. Argentina, led by president Cristina Fernández, expropriated Repsol’s majority stake in YPF, its former state oil company, last year after accusing the company of failing to invest sufficiently in the country’s energy sector, a charge Repsol vehemently denied. Repsol was […]

Posted On : Published By : Tom Whipple