Last week Diezani Alison-Madueke, Nigeria’s oil minister and the president of Opec, called for an extraordinary meeting of the oil exporters’ cartel in the face of falling prices. Rafael Correa, president of Ecuador, Opec’s smallest member, rallied behind her saying prices were “unnecessarily low”.
They may not achieve much – Saudi Arabia and other Gulf exporters are against production cuts – but the calls will nevertheless be welcome in Venezuela, where the sudden collapse of oil prices has been especially bad news. Read more
Venezuela’s President Nicolás Maduro had many words of praise for his Chinese counterpart, Xi Jinping, after their meeting in Beijing this week.
However, as fastFT reports, the announcement that he had taken more than $20bn in investment from China for various types of projects left many wondering if the president of the oil-dependent Caribbean nation had really got what he wanted. Read more
Another year, another announced change to one of the world’s tightest and most complex foreign exchange regimes. Unsurprisingly, however, the long-awaited change has fallen short of the full scale reform of currency controls promised last week by Nicolás Maduro, Venezuela’s increasingly isolated president. Read more
Among the many woes afflicting Venezuela, one of the most pressing is the rapid decline in its reserves of hard currency. These fell from some $29bn at the start of 2013 to a low of about $19bn last week. But Beijing’s generous hand has since boosted them to $23.5bn, according to the central bank.
The fall in reserves had raised concerns about Venezuela’s ability to pay its debts, so the influx brought some relief to rattled markets, fuelling a small rally off recent lows in Venezuelan bonds, which remain among the highest yielding in the world.
But is the influx all it appears to be? Read more
Even after Venezuelan officials angrily denounced the US late Thursday for allegedly denying their president clearance to fly through its airspace on its way to China, Nicolás Maduro was still determined to get to Beijing this weekend.
With its economy in disarray, you can’t blame Caracas for wanting to cultivate closer ties with Beijing. Just this week, the country announced that it would partner with China National Petroleum (Sinopec) on a $14bn development project in the Orinoco heavy oil belt. Maduro will no doubt be hoping to secure more deals during his three-day visit to China – which kicks off on Saturday. Read more
It is well known that Hugo Chávez is the one that takes the all big decisions in Venezuela, and quite a lot of the smaller ones too.
Indeed, the policy paralysis as he battles cancer from his hospital bed in Havana is becoming all too evident. But there is growing evidence that other important decisions for the nation outside of the government’s control are also being postponed because of Chávez’s absence – in particular regarding investment by foreign companies interested in developing oilfields in the Orinoco Belt. Read more
Venezuelan state oil company PDVSA’s ubiquitous propaganda constantly trumpets the fact that it now belongs to “everyone”, since control of the oil giant was wrested from opponents of Hugo Chávez ten years ago.
But to paraphrase George Orwell, one could say that its wealth belongs to some people more than others – take the example of Sun Weijie, the Chinese businessman who has just become a billionaire on the back of a juicy supply contract with PDVSA. Read more
Although the exact level of Venezuela’s oil production has been shrouded in mystery for almost a decade now, there is no doubt about the OPEC nation’s intentions to increase exports to China.
Whether they will equal exports to the US within three years, however, as energy minister Rafael Ramirez (pictured) on Thursday said they would, is of course another matter – if state oil company PDVSA’s consistent failure to meet production targets in the past is anything to go by. Read more
While Hugo Chávez may be rubbing his hands together with glee as he officially confirms on Wednesday plans to borrow $4bn from China, now by far Venezuela’s biggest foreign source of financing, state oil company PDVSA has less to celebrate.
For needless to say, the fact that China has lent more (now $32bn) to Venezuela than any other country in Latin America comes at a cost – and PDVSA is bearing the brunt of the burden. Read more
When a jovial Hugo Chavez received a delegation of Chinese bankers and diplomats in the Miraflores presidential palace this week, his visitors at times looked bemused as he expounded effusively on the wisdom of Chairman Mao, dragons and steel tigers.
But what Venezuela and China may lack in mutual cultural understanding is more than made up for in a burgeoning economic relationship, with a $4bn loan from the Chinese Development Bank confirmed on Thursday adding to existing lending from China of some $32bn. Read more
What would Hugo Chávez do without China? From cheap fridges for the poor to life-saving state-to-state loans, help with building essential housing to massive investments in major oil projects, there’s scarcely an area of Venezuela’s economy where China doesn’t play a key role.
However, while there’s no question that China’s help is of great importance for Chávez – not least given a deterioration in relations with the private sector and countries that have more traditionally been keen to invest in Venezuela, like the US – some doubt whether he is always cutting the best deal. Read more