Venezuela's Economy Today
From Dickinson College Wiki
The world will have to get used to a barrel of oil priced above 50 dollars, ... It will be difficult to increase production. Hugo Chavez
Today's Petroleum Industry
- Venezuela's growth experience over the past fifty years is characterized by a high economic growth rate from 1950 to 1970 and a low economic
growth rate in the last thirty years.
Current Statistics:
- Venezuela is the fifth largest oil exporting country in the world, with the largest reserves of conventional oil (light and heavy crude) in the western hemisphere and the largest reserves of non-conventional oil (extra-heavy crude) in the world.
- Oil production currently accounts for 16% of Venezuela's GDP.
- However, some problems are present:
- Reports that PdVSA is in shambles are increasing and this means that Venezuela is becoming more dependent on foreign oil production. In 2002 a 18 month strike occured at PdVSA when unions demanded better policies. It was also an effort to throw out Chavez. This dramastically cut the production of oil and severly hurt the economy. Economist predict that it will take years for the economy to recover.
- Instead of pursuing PDVSA's strategy of expanding capacity to capture more market share at lower prices and maximize revenues by boosting export volumes, Chavez adopted a strategy of relying on OPEC production controls to raise prices.
Graph detailing oil production in Venezuela during 2002 to 2003 and showing the effect of the PdVSA strike in early 2003.
File:PriceofCrudeOil20050509.png
