In Venezuela, all oil drilling has stopped, while world market prices for crude oil have collapsed. When OPEC decided to cut production several weeks ago, it had excluded the South American country because it is not even able to meet its daily quota as it is producing less than 700,000 barrels per day (five years ago it was extracting almost three million). “It is the first time in 100 years that there is not a single drill working in the country, which was the world’s leading oil exporter (1925-1970) and today has the largest (crude) reserves,” says economist Orlando Ochoa.
U.S. sanctions, which are pressuring Maduro to negotiate his exit from power, have limited the ability of the national energy industry to act. The big ally, the Russian company Rosneft, closed operations leaving its assets in the hands of another Russian firm, while joint ventures with firms like Chevron or Repsol, for example, are no longer producing black gold.
The U.S. Treasury Department extended until December 1 the license to remain in Venezuela to Chevron and the service companies Halliburton, Schlumberger, Baker & Hughes and Weatherford. But the permit does not allow them to drill wells, sell and buy oil or oil products or transport them.
Maduro, therefore, has run out of revenue, and its international position prevents it from accessing international credits in view of the government’s questioned legitimacy. Two loans that he requested from the International Monetary Fund in the last month and a half – after years of anti-IMF rhetoric – were rejected because the institution does not guarantee that Maduro is indeed the legal leader of the country.
Ninety-seven percent of the country’s income depends on the sale of oil. And without money there are no imports of either fuel or food.