More fun and games with Venezuela - oil production tanking

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From Yahoo/Reuters:

Deepening default fears cast shadow over Venezuela's oil flows
As Venezuela grows closer to exhausting nearly every means of paying its debt, some oil market participants are seriously pondering the possible implications of an unprecedented event: the default of a major crude producing company.

State-run firm PDVSA faces around $5.2 billion in payments to bondholders in 2016, much of it in October and November, a sum that some experts say it will be hard-pressed to meet after the government used nearly all of its available cash reserves to pay $1.5 billion in maturities last week.

A default could curtail some of the OPEC member's exports by crippling its ability to import crude and fuels used to blend its extra heavy oil, experts and sources say. It could also degrade the quality of domestic gasoline by limiting purchases of necessary components.

Something I did not know - Venezuela's oil is heavy crude and they need to import much lighter oils to blend with it before it is usable in normal internal combustion engines. Can't do much of that if they are too overspent with bread and circuses. Again, the oil and mining industries used to be in private hands and they made Venezuela a very wealthy nation. Chavez literally killed the golden goose by nationalizing these businesses and failing to perform basic maintenance.

He could have spent the profits on infrastructure, basic research, schools and hospitals but no, the money went to free shit from the government to buy votes.

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This page contains a single entry by DaveH published on February 28, 2016 7:35 PM.

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