Latin America

Venezuela to Begin Process to Withdraw From Organization of American States

27 Apr 2017   Venezuela

Venezuela said it would begin a two-year process to pull out of the world’s oldest regional diplomatic body, in a move that is likely to heighten tensions with its neighbors over President Nicolás Maduro’s authoritarian rule. Foreign Minister Delcy Rodriguez said Wednesday that Mr. Maduro ordered the withdrawal from the Organization of American States after 19 of the group’s 34 members agreed on a resolution to…

Venezuela Says It Will Leave Pro-Democracy Organization

27 Apr 2017   Venezuela

Venezuela said Wednesday that it would pull out of the Organization of American States , which has long been critical of President Nicolás Maduro’s unyielding accumulation of power at the expense of the country’s democratic institutions. The move increases Venezuela ’s isolation while its government is struggling to put down mass street protests demanding new elections. And it shows that the country — which, through anticapitalist rhetoric and oil largess, once aimed to challenge the United States as a power in Latin America — is becoming something of a pariah in its own region.

GM Factory Seizure Threatens Oil Sector In Venezuela

27 Apr 2017   Venezuela

The Venezuelan government’s seizure of a GM factory, as reported by Reuters, signals that the deeply corrupt regime of President Nicolas Maduro is escalating its self-defeating actions. Ironically, for oil prices, this could prove bullish, as the operating environment is increasingly hostile and the few foreign firms still operating oil assets may flee the country. Of course, with oil providing between 40 percent and 70 percent of government revenues (depending on the oil price), a seizure of foreign oil assets by Maduro’s regime would display a level of short-sightedness unrivaled by other oppressive government officials. But the GM seizure suggests that it is indeed a possibility, and Maduro’s regime is anything but rational. In essence, the GM factory seizure represents a tipping point, putting Venezuela far closer to seeing its oil production shrink, rather than expanding it. Foreign firms, many of which have already packed their bags and left, […]

As Venezuela Declines, So Does Its Latin American Influence

27 Apr 2017   Venezuela

A document circulating in Peru, part of a broad political corruption investigation, stands as a quaint piece of Hugo Chávez memorabilia. It’s a 2006 letter allegedly penned by the late socialist Venezuelan president to one of his regional comrades, Peruvian presidential candidate Ollanta Humala. It suggests Chávez gave Humala’s campaign $2 million in what the letter calls “revolutionary aid.” Humala, who became Peru’s president in 2011 and left office last year, denies taking cash from Chávez. But the letter recalls something larger: a time when Venezuela wielded clout. A decade ago, as crude prices soared above $100 a barrel, the South American nation with the world’s largest oil reserves was a petro sugar daddy. The firebrand Chávez cast his largesse from the Bahamas to Buenos Aires, buying influence for his left-wing, anti-U.S. revolution. Venezuela used to be sugar daddy to the region’s leftists. Now it can’t feed itself. Chávez […]

Some oil companies in Venezuela pull expats amid protests: sources

26 Apr 2017   Venezuela

As political turmoil in Venezuela persists, oil firms including Norwegian major Statoil ASA ( STL.OL ) and Spain’s Repsol SA ( REP.MC ) have further reduced their already-dwindling ranks of expatriate employees in the country, sources familiar with the situation said. Statoil, Repsol and Chevron Corp ( CVX.N ) are among the foreign oil companies that hold minority stakes in more than 40 joint ventures with state-run Petroleos de Venezuela [PDVSA.UL] (PDVSA), providing cash-strapped Venezuela with crucial crude production and income amid a debilitating economic crisis. Venezuela, South America’s largest oil exporter, has been pummeled by a brutal economic crisis that has millions skipping meals, unable to afford soaring prices for basic goods and facing long lines for scarce products. More than a dozen people have been killed during near […]

Death toll in Venezuela’s unrest rises to 26

26 Apr 2017   Venezuela

Two Venezuelan men died on Tuesday from gunshots at political demonstrations, bringing to 26 the number of fatalities around this month’s protests against President Nicolas Maduro’s socialist government. The state prosecutor’s office said Orlando Medina, 23, was gunned down on a street in western Lara state during a protest local media identified as anti-Maduro. Luis Marquez, 52, died in the Andean state of Merida in the early morning after being shot on Monday at a pro-Maduro rally, state ombudsman Tarek Saab said. In more than three weeks of chaos since Venezuela’s opposition launched street protests, 15 people have died in violence around demonstrations and 11 others in night-time lootings, the state prosecutor’s office said on Tuesday. Political activists and Venezuelan media have reported more deaths, but those have not been confirmed. […]

Argentina’s Push to Mimic Permian Success Faces Long Road Ahead

26 Apr 2017   Argentina

Vaca Muerta geology a match, support services fall short Energy assets could be key to country’s economic future Argentina’s Vaca Muerta, one of the largest shale formations outside of North America, offers tons of promise for the country’s energy future. Just don’t hold your breath waiting for it. Energy Minister Juan Jose Aranguren , billionaire investor Paolo Rocca and bullish Morgan Stanley economists all predict lightning fast growth in the region, comparing it to the Eagle Ford and Permian basins in the U.S., oil and natural gas-saturated plays that have spurred billions in revenue. Photographer: Juan Mabromata/AFP via Getty Images The reason: Vaca Muerta offers Argentina, which has struggled for years with rampant inflation, an economic lifeline for the future. Still, before the field reaches its potential, gas and oil pipelines need to be built, roads, train lines and power networks need upgrading, and drilling costs that run 30 […]

Venezuela’s Complicated Crisis For Oil

26 Apr 2017   Venezuela

The cold logic of the oil market dictates that crisis usually equals profit. That’s because a crisis in oil usually means a supply crisis, as some large producing country becomes embroiled in war or civil unrest or sanctions or some other geopolitical mess. The country currently occupying the unenviable position of being the likeliest source of a supply shock is Venezuela. The collapse in oil prices has savaged the country’s economy and brought political tensions to a head in the form of a constitutional crisis, mass protests and, particularly over the past week or so, looting and fatalities. From the oil market’s perspective, the question is whether Venezuela’s intensifying problems will cause an outright collapse in its production, currently running at about 2 million barrels a day. It’s a bit more complicated than that, though. Venezuela’s supply has slumped already: But so has domestic demand: Put the two together, […]

Venezuelan opposition seeks new strategy as unrest enters fourth week

25 Apr 2017   Venezuela

Barricading roads with trash and even bathtubs, small groups of protesters held “sit-ins” around Venezuela on Monday in an effort to maintain momentum as anti-government unrest entered a fourth week. Ten people have been killed during near daily clashes this month between security forces armed with rubber bullets and tear gas, and protesters who have sometimes thrown rocks and petrol bombs. At least 10 people have also died during night-time looting. President Nicolas Maduro’s socialist government accuses protesters of seeking a violent coup with U.S. connivance, while the opposition says he has become a dictator repressing peaceful demonstrations. The protesters’ main demand is for elections, although the anger is also underpinned by crippling economic crisis in the oil-producing country. “I have an empty stomach because I […]

Venezuela’s President Maduro calls for talks with opposition

24 Apr 2017   Venezuela

The latest protests were on Saturday and another march is planned for Monday Venezuela’s President Nicolas Maduro has called for talks to resume with the opposition. He also said he wanted local elections to take place. His comments came as another large demonstration is planned for Monday after three weeks of tense protests across the country. Demonstrators have been calling for presidential elections due next year to be brought forward and for President Maduro to step down. Last year’s negotiations between the opposition and the government broke down when the opposition accused Mr Maduro of breaking agreements and using the talks to buy time. Speaking during his Sunday TV programme, Mr Maduro endorsed the idea of elections for mayors and state governors but did not mention a vote at presidential level. “Elections – yes, I want elections now,” he said “That is what I say as the head of […]

At Least 12 Die as Rioting Breaks Out in Venezuela

22 Apr 2017   Venezuela

At least a dozen people were killed as the streets of Caracas, Venezuela, erupted into a night of riots, looting and clashes between government opponents and the National Guard late Thursday and early Friday, with anger from two days of pro-democracy demonstrations spilling into unrest in working-class and poor neighborhoods. The attorney general’s office in Venezuela said 11 people had died of electrocution and gunshot wounds “in acts of violence” in El Valle, a neighborhood of mixed loyalties, where armored vehicles struggled to contain crowds of looters. In Petare, a working-class section in eastern Caracas, a protester was shot dead at the entrance to the city’s largest barrio, said Carlos Ocariz, the district mayor. Throughout the night, the sounds of banging pots and pans reverberated through the capital, a traditional form of protest known as the “cacerolazo,” which has taken on greater significance as the country struggles with shortages […]

Maduro targets companies as Venezuela unrest grows

22 Apr 2017   Venezuela

Venezuela’s president Nicolás Maduro has ordered an investigation into Telefónica’s Movistar for alleged “coup-mongering” after a week of protests against his increasingly repressive rule. Mr Maduro accused the subsidiary of Spain’s Telefónica of supporting opposition rallies which have led to pitched battles in which nine people have been killed and scores detained. “I denounce the company Movistar of Venezuela. I have ordered an investigation because it joined the coup-mongering call against the country, and that is not its function,” he said, adding “every two hours the company Movistar sent millions of messages to its phone and internet customers” as part of a “cyber war”. Telefónica was unavailable for comment, but it is not the only company caught up in the strife in Venezuela. On Wednesday, General Motors said it ceased operations after one of its plants was seized by local authorities. The US-based company said the move will cause “irreparable damage to the company and its 2,678 workers”. Tensions continue to grow as Mr Maduro’s foes demand early elections to speed up his removal from office amid worsening shortages of basic goods, violent unrest and political repression. Opponents are vowing no let-up in the pressure as the socialist leader clings to power. “When one lives in a lawless country, one has to take to the street to protest for our dignity and rights,” said Julio Borges, a leading opposition lawmaker. Local media reported unrest in poor areas of the capital on Thursday night. Critics had called for protests across the country on Friday, a silent march in Caracas on Saturday of people dressed in white to commemorate those killed in the unrest, and a nationwide sit-in to block some of Venezuela’s main roads on Monday.

Exxon Is Going Primetime With The World’s Next Shale Hotspot

22 Apr 2017   Argentina, Shale Oil

The U.S. shale sector continues to be the hottest spot in natural resources investment. But news this week suggests America’s oil and gas industry may have a new rival — as shale in a completely different part of the world gets ready to go commercial. In Argentina. The governor of Argentina’s Neuquen province Omar Gutierrez said in a statement Monday that shale production is about to begin in earnest in his territory. With ExxonMobil reportedly about to push the button on a major project in the Vaca Muerta shale here over the coming weeks. Governor Gutierrez noted that he was in Houston last week meeting with Exxon management. Who reportedly told him the company will enter the “production phase” on the company’s Vaca Muerta projects this May. Gutierrez didn’t give additional detail on the specific projects that will be put into full-scale production. And Exxon itself hasn’t made any […]

GM Ceases Operation in Venezuela as Plant Is Seized

21 Apr 2017   Venezuela

General Motors Co. became the latest multinational company to exit what used to be South America’s most lucrative consumer market, following the seizure of its plant linked to a court case. Venezuelan authorities on Wednesday unexpectedly took over GM’s plant in the central Carabobo state, seizing production facilities and car stock, the company said in a statement. GM, the world’s third-largest car maker, said it…

Venezuela state oil company gave cash to Trump inauguration

21 Apr 2017   Venezuela

Venezuela has donated $500,000 to US President Donald Trump’s inauguration, newly released records show. Citgo Petroleum, a US-based subsidiary of the Venezuelan state-owned oil company, is named in papers filed with the Federal Election Commission. The revelation comes as the Venezuelan economy appears to be crippled by food shortages, violent crime and inflation. Three people were killed in protests on Wednesday as tens of thousands took to the streets to demand new elections Other major corporations named in the documents include Pepsi and Walmart, which gave $250,000 and $150,000 respectively, while owners of NFL teams or their companies gave more than $5m. Casino owner and billionaire Sheldon Adelson also gave $5m. Business as usual – Analysis by Luis Fajardo, BBC Mundo Venezuela is in the middle of a major economic crisis, which has the oil-rich country flirting with hyperinflation. This Wednesday, street protests demanding the resignation of President Nicolas […]

Many Poor Venezuelans Are Too Hungry to Join Antigovernment Protests

21 Apr 2017   Venezuela

President Nicolás Maduro has lost support among the legions of poor Venezuelans that once backed the late Hugo Chávez, but they have largely shown little interest in joining the opposition-led protests that have convulsed the country the past three weeks. Many of the impoverished residents of the vast slums that ring Caracas and other major cities are angry about a collapsing economy and food shortages. But Venezuela’s political unrest remains mostly confined to middle-class enclaves, underscoring the…

Exxon Mulls Big Investment In Argentina As Part Of Shale Strategy

21 Apr 2017   Argentina

ExxonMobil is betting on shale development not only on its home turf. The supermajor is also planning to speed up investment plans for shale gas drilling in Argentina’s prized Vaca Muerta formation in the Neuquen province. Exxon will start drilling Vaca Muerta in May, by drilling horizontal wells with laterals of 2,500-3,000 meters (8,202-9,843 feet), Neuquen province governor Omar Gutiérrez said on Monday. The U.S. major’s total investments in developing Vaca Muerta will have reached $750 million by the end of this year, said Gutiérrez, who discussed Exxon’s plans with executives of Exxon and its subsidiary XTO in Houston last week. ExxonMobil Exploration Argentina (EMEA) has been present in Vaca Muerta since 2010 . Last year, following the successful initial exploration results in the Bajo del Choique-La Invernada block, EMEA launched a pilot project to continue to assess the productivity and recovery of horizontal wells in Vaca Muerta. The […]

At Least 3 Die in Venezuela in Violent Protests Across the Country

20 Apr 2017   Venezuela

Protesters demanding elections and a return to democratic rule jammed the streets of Caracas and other Venezuelan cities on Wednesday. National Guard troops and government-aligned militias beat crowds back with tear gas, rubber bullets and other weapons, and at least three people were killed, according to human rights groups and news reports. President Nicolás Maduro defied international calls, including a plea from the American State Department, to allow peaceful assemblies and ordered his forces into the streets. Some demonstrators, wearing masks to protect themselves from tear gas, fought back with firebombs. Still, despite the deaths in recent protests, now numbering seven, Wednesday’s rallies attracted thousands of people, the latest in a string of demonstrations against the increasingly autocratic rule of Mr. Maduro. Labeled by organizers “the mother of all protests,” it showed that a sustained movement in the streets against Mr. Maduro may now be forming. […]

Banned at sea: Venezuela’s crude-stained oil tankers

18 Apr 2017   Venezuela

In the scorching heat of the Caribbean Sea, workers in scuba suits scrub crude oil by hand from the hull of the Caspian Galaxy, a tanker so filthy it can’t set sail in international waters. The vessel is among many that are constantly contaminated at two major export terminals where they load crude from Venezuela’s state-run oil company, PDVSA. The water here has an oily sheen from leaks in the rusty pipelines under the surface. That means the tankers have to be cleaned before traveling to many foreign ports, which won’t admit crude-stained ships for fear of environmental damage to their harbors, port facilities or other vessels. The laborious hand-cleaning operation is one of many causes of chronic delays for dozens of tankers that deliver Venezuela’s […]

Venezuela opposition seeks to strain security forces with protests

14 Apr 2017   Venezuela

Venezuela’s opposition was rallying across the nation on Thursday as part of a bid to strain security forces by staging anti-government protests in each of the volatile country’s 335 municipalities. The oil-rich but crisis-shaken South American nation has been convulsed by escalating protests over the last two weeks amid a punishing recession and accusations that Maduro has seized dictatorial powers. In a worrying sign for Maduro, people in traditionally pro-government slums and low-income areas have blocked streets and lit fires during scattered protests this week. A crowd also broke through a security cordon at a Maduro rally on Tuesday, heckling him and throwing stones while bodyguards scrambled. Authorities confirmed a fifth person had been killed during protests over the last week, as the opposition pushes an agenda […]

U.S. Oil Assets Could Fall Into Russian Hands If Venezuela Defaults

13 Apr 2017   Venezuela

If Venezuela defaults on its debt obligations, it could result in Russia taking control over U.S. refining assets, leading to more Russian “control over oil and gas prices worldwide,” which would “inhibit U.S. energy security, and undermine broader U.S. geopolitical efforts.” That is the warning from two members of Congress, Reps. Jeff Duncan (R-SC) and Albio Sires (D-NJ). The two Congressmen sent a joint letter to the U.S. Secretary of Treasury Steven Mnuchin, requesting his attention on the matter. A bipartisan group of six U.S. Senators also requested a response from Secretary Mnuchin on the matter. They cite the fact that Russia’s government-backed oil company, Rosneft, gave Venezuela’s state-owned oil company, PDVSA, a $1.5 billion loan. As collateral, PDVSA offered up 49.9 percent of Citgo, a subsidiary of the Venezuelan oil company. Citgo owns three refineries in the U.S., along with pipelines and retail gas stations. The Congressmen are […]

PDVSA Notes Rally After Venezuela Makes Good on $2.2 Billion Debt Payment

13 Apr 2017   Venezuela

Oil company honors debt obligations amid political unrest Government says it will continue paying debt due this year Bonds issued by Venezuela’s state oil company rallied after the country made $2.2 billion in payments on notes that matured Wednesday. The $1.1 billion of notes from Petroleos de Venezuela that come due in seven months gained 2.1 cents to 87.3 cents on the dollar as of 3:17 p.m. in New York. The payment, which was confirmed by Delaware Trust Company, strengthened investor confidence that the nation can avoid default for yet another year. The debt from the state oil company maturing Wednesday had traded as low as 94 cents on the dollar last week amid doubts on whether Venezuela would make good on its obligations. The notes shot up to 97 cents on Friday after PDVSA said it had begun the payment process. Traders will be closely watching foreign reserve […]

Venezuela Staves Off Default, but Low Oil Prices Pose a Threat

13 Apr 2017   Venezuela

Venezuela has put off a reckoning on its tens of billions of dollars in debt, but its ability to avoid a disastrous default will probably require much higher oil prices than appear likely in the next year or two, financial experts say. With its oil production and international reserves falling at an accelerating rate, the government is juggling as fast as it can to pay for imported food and medicines while meeting its short-term bond payments. Even as the country has slashed imports, its reserves have declined by half over the last two years, to $10.4 billion. Most of that sum is in gold and is pledged as security for many of the government’s creditors, which include international institutional investors and everyday Venezuelans.

Venezuela: Severe Nationwide Protests Continue

12 Apr 2017   Venezuela

Widespread and intense protests continued across Venezuela on April 11, El Nacional reported. The day before, protesters alleged that authorities fired tear gas onto the grounds of the Policlinica Las Mercedes hospital in Caracas and opposition leader Henrique Capriles said a baby had been injured in the incident. A 20-year-old protester was shot and killed in the city of Valencia. Demonstrations began April 4 and escalated April 6. Venezuelan Vice President Tareck El Aissami said that molotov cocktails had been confiscated from demonstrators. Justice Minister Nestor Reverol said that police arrested 18 demonstrators April 10 in Caracas for disturbing the peace. Between April 4 and April 8, authorities arrested 188 people, and 57 remain in detention, according to El Foro Penal Venezolano (FPV). The demonstrations are a reaction to the country’s economic crisis and attempts to consolidate power into a single-party state. The ruling United Socialist Party of Venezuela […]

Venezuela Creditor Seeks Asset Freeze on U.S. Refiner Citgo

11 Apr 2017   Venezuela

Venezuela’s state-owned oil company should be stopped from plundering its U.S. subsidiary Citgo Holding Inc., according to court papers filed Monday evening by a creditor seeking $1.4 billion from the South American country. Canadian mining company Crystallex International Corp. asked a Delaware federal judge for an injunction blocking Petróleos de Venezuela SA—also known as PdVSA—from taking cash or transferring assets from Citgo,…

Venezuela Is The Wild Card In The OPEC Deal Extension

11 Apr 2017   Venezuela

News coming out of Venezuela over the past two years has reeked of corruption and failed political leadership: a long list of shortages , rampant poverty , incrimination of the opposition , and a recent move that puts the regime of Nicolas Maduro one step closer to a dictatorship . And these are only the developments that are recorded, with a recent LA Times Op-Ed suggesting that a Venezuelan homicide epidemic rages “unreported” due to the country’s scrapping of crime statistics reporting over a decade ago. Despite all of this, the Organization of Petroleum Exporting Countries (OPEC) expects Venezuela, endowed with the world’s largest oil reserves (depending on who you ask), to play a major role in the cartel’s plan to curb global supply. In OPEC’s November agreement, Venezuela accounted for almost 10 percent of the net supply cut from member nations (calculated as cuts minus allotted increases). (Click […]

Venezuela confirms young man killed during anti-Maduro protests

8 Apr 2017   Venezuela

A police water cannon disperses demonstrators during an opposition rally in Caracas, Venezuela. Venezuelan authorities confirmed that a young man was killed on Thursday during anti-government protests and vowed to investigate the fatal attack, the first since a controversy over the Supreme Court blew up last week. Thousands of Venezuelan opponents of President Nicolas Maduro’s socialist government marched on Thursday to protest a decision by the administration-leaning top court to assume control of the opposition-led congress in what demonstrators said was a lurch toward dictatorship. While the widely condemned decision was quickly overturned, the opposition has stepped up street protests against Maduro, even though such demonstrations have achieved little in the past. The march culminated in clashes, and opposition leaders said on Thursday night that Jairo Ortiz was shot in a Caracas suburb by security forces that were breaking up a protest there. “In the face of the vile […]

US Congress calls for CFIUS review of Rosneft’s potential stake in Citgo

8 Apr 2017   Venezuela

A deal to give Russia’s Rosneft 49.9% ownership of US refiner Citgo if Venezuela’s cash-strapped national oil company PDVSA defaults on its loans threatens US national security and should be investigated by the Committee on Foreign Investment in the United States, two US congressmen have said. “This would give Russia clear control over the sixth-largest refinery in our country, the ability to impact gas prices for the American people, and a strategic advantage over US freedom of action globally,” Representative Jeff Duncan, Republican-South Carolina, said in a statement Thursday. Duncan and Representative Albio Sires, Democrat-New Jersey, asked US Treasury Secretary Steven Mnuchin, CFIUS’ chairman, in a letter Thursday to investigate the deal. They are the top members of the House Committee on Foreign Affairs’ Western Hemisphere subcommittee. CFIUS is an inter-agency committee that scrutinizes foreign investments for national security implications. In November, PDVSA assigned as collateral to Rosneft “all […]

Homeless Gasoline Tankers Are Drifting Around the Caribbean

A few gasoline cargoes around the Caribbean Isles are looking for homes. Three tankers holding about 1.35 million barrels of gasoline and alkylate, an octane-boosting component blended with motor fuels, are drifting with no instructions for delivery. The cargoes came from India with intent to land in the U.S., but now they’re in limbo as traders from Trafigura Group Ltd. and Mercuria Energy Group Ltd. shop around for the best selling value in the region. Trafigura left the River Shiner drifting north of the Bahamas after the India-loaded gasoline cargo was diverted away from its New York Harbor destination earlier this week. Mercuria’s alkylate cargo aboard Spottail, which also loaded in India, has floated near Freeport, Bahamas, since March 27. Another Mercuria-chartered ship, Lake Trout, has drifted in the Gulf of Mexico for nearly two weeks. Representatives of Trafigura and Mercuria declined to comment on the ships or their […]

Venezuela’s PDVSA Says It Will Make April 12 Bond Payment

7 Apr 2017   Venezuela

Venezuela’s state oil producer PDVSA said it will pay $2.1 billion in bonds after a plunge in crude production and dwindling cash flow spurred bets on a default. Caracas-based Petroleos de Venezuela SA told investors that principal and interest payments related to its bond that matures this month will be available in investor accounts on April 12, the company said in an emailed statement. It added that it had already started transferring coupon payments for other bonds that mature in 2027 and 2037. The weeks leading up to the payment had seen volatile price swings in bond prices as investors worried a deteriorating political situation could influence the country’s ability or willingness to repay its debt. The country’s dollar bonds fell the most in two years on March 31 as an ongoing dispute between the government of President Nicolas Maduro and the opposition-controlled National Assembly worsened and resulted in […]

Exxon To Enter The Most Sought After Oil Play In The World

6 Apr 2017   Brazil

The Wall Street Journal reported that Exxon is looking to jump into Brazil’s offshore sector, one of a few areas of exploration where there are still enormous volumes of known but underdeveloped oil reserves. Brazil’s pre-salt – oil trapped beneath a thick layer of salt – is looking increasingly attractive to international oil companies because of a law change in 2016 that opened up the sector to investment from private companies. Up until recently, the vast pre-salt was under the domain of Brazil’s state-owned oil company Petrobras. International companies could work as junior partners in a joint venture, but by law, Petrobras had to take the lead on any offshore drilling project and hold at least a 30 percent stake in any project. That requirement was enacted after a handful of truly massive oil discoveries put Brazil’s pre-salt on the map a decade ago. Triple-digit oil prices led Brazilian […]

Exxon Eyes Brazil Expansion

5 Apr 2017   Brazil

Exxon Mobil Corp., the only big oil company without a major foothold in Brazil, is in talks to gain access to the country’s prized deep-water resources, according to people familiar with the matter. The talks have included discussions about a joint venture partnership through which Exxon would invest in projects with state-oil firm Petróleo Brasileiro SA, or Petrobras, as well as potentially buying stakes in offshore tracts the…

Petrobras says Exxon expressed ‘strong interest’ in pre-salt oil

5 Apr 2017   Brazil

Brazil’s state-run oil company Petroleo Brasileiro SA Chief Executive Officer Pedro Parente talks during a news conference in Rio de Janeiro, Brazil, January 11, 2017. REUTERS/Nacho Doce U.S. oil company Exxon Mobil Corp ( XOM.N ) expressed to Brazil’s state-controlled company Petrobras ( PETR4.SA ) “strong interest” in the exploration of deep-water oil fields off the Brazilian coast, Petrobras Chief Executive Pedro Parente said on Tuesday. “Considering movements towards a strategic partnership, we have nothing concrete with Exxon, but they have certainly expressed strong interest in the Brazilian pre-salt exploration,” Parente told reporters. Earlier on Tuesday, The Wall Street Journal reported that Exxon was in talks to gain access to Brazil’s deep-water oil resources, citing people familiar with the matter. Petroleo Brasileiro Sa Petrobras, familiarly known as Petrobras, and Exxon initially declined to comment on the report, but later Parente briefly spoke about it on his way out of […]

Venezuelan democracy rallies after failed coup

4 Apr 2017   Venezuela

For nearly two decades, Venezuela’s socialist government has maintained a façade. It proclaimed democracy and concern for social rights. In reality, it eroded civil, political and economic freedom. For a long time, “chavismo” deployed its disguise — and its petrodollars — to win sympathy at home and abroad. But when the government-controlled Supreme Court last week annulled the opposition-controlled Congress, claiming it was in contempt of the law, the mask fell. The true face of President Nicolás Maduro’s government was revealed: a deeply cynical authoritarian regime. The backlash to the legalistic coup engineered by the compliant Supreme Court was fierce. The opposition cried “dictator”, with justification: the National Assembly is the last independent institution remaining in Venezuela. Condemnation from longstanding international critics such as the US was swift. Mr Maduro had taken a step too far. Perhaps Mr Maduro thought he could mock the outcry as “fascist” rantings, as he has before. But then the UN, the EU and some Latin American countries that have previously been muted in their criticism, decried the move too. In a remarkable statement broadcast live on state television — until it was cut off — Venezuela’s attorney-general, a government stalwart, criticised the move. Together, the opposition’s fury, international condemnation and unprecedented public dissent by a senior official proved too much. On Friday night, Mr Maduro convened the so-called state security committee and asked the Supreme Court to re-consider. On Saturday, its judges complied (so much for separation of powers)

Venezuela money supply up 200 percent in year, fastest rise on record

4 Apr 2017   Venezuela

Crisis-stricken Venezuela’s money supply has surged over 200 percent in a year, its fastest rise since records began in 1940, putting it on track for what is likely the world’s highest inflation. Soon after a month-long hiatus from publication, the central bank said late on Friday the total amount of local currency in circulation – known as M2 by economists – as of March 24 was 13.3 trillion bolivars, up 202.9 percent from a year earlier. In contrast, the United States’ money supply was up 6.4 percent in the same period. Venezuela is in a major economic crisis, with millions struggling with food shortages and inflation thought to be in triple digits – though no official data is available. The exponential rise in M2, the sum of […]

Scattered protests in Venezuela, OAS cancels crisis meeting

4 Apr 2017   Venezuela

Opposition supporters shout slogans as they block a highway during a protest against Venezuelan President Nicolas Maduro’s government in Caracas. REUTERS/Carlos Garcia Rawlins Venezuela’s opposition sought to keep pressure on President Nicolas Maduro with scattered protests on Monday, but there was relief for the Socialist government when the Organization of American States canceled a crisis meeting. One group of protesters tried to block a major Caracas highway and another dropped a pile of straw in front of the Supreme Court, which last week controversially assumed the responsibilities of the opposition-led congress. Though the top tribunal rowed back on that decision, which was condemned globally and led to unrest, the opposition is pushing to remove the judges responsible. The OAS meeting was called at the weekend by a group of 20 countries concerned about democratic erosion in Venezuela under Maduro, who replaced socialist firebrand Hugo Chavez in 2013. No reason […]

Venezuela opposition turns ire on Supreme Court judges

3 Apr 2017   Venezuela

Venezuela’s opposition lawmakers said on Sunday they will push for the removal of Supreme Court judges whom they accuse of acting on behalf of the ruling Socialists after the top tribunal briefly assumed control of congress last week. While the move by the opposition-led congress would only be symbolic because it remains powerless, it could add to pressure on unpopular president Nicolas Maduro as he tries to defuse the furor over what critics saw as a lurch into dictatorship. The Supreme Court’s ruling last week that it would take over functions of the National Assembly triggered international […]

Venezuela’s Maduro wins power over oil despite court reversal

3 Apr 2017   Venezuela

The Venezuelan Supreme Court may have amended part of its explosive decision to take over the opposition-led congress, but it still gives embattled leftist President Nicolas Maduro broad new powers over the OPEC nation’s vast oil wealth. The reversal on Saturday came after political leaders worldwide and street protesters at home accused the pro-government court of effectively making Maduro a dictator. While the court backed off its Wednesday decision to fully take over the legislative branch, it left in place sweeping new authority for Maduro to cut oil deals on behalf of PDVSA, the state-run oil company, without congressional approval. Maduro’s cash-strapped government now has the autonomy to sell stakes in Venezuela’s oil fields, which contain the world’s largest reserves, or […]

Venezuela’s Descent Into Dictatorship

1 Apr 2017   Venezuela

A ruling this week by Venezuela’s Supreme Court stripping the nation’s legislative branch of all authority — and vesting that power in the court itself — moves a country already beset by violence and economic scarcity one step closer to outright dictatorship.  The decision means essentially that every arm of Venezuela’s government is now under the thumb of President Nicolás Maduro, whose supporters have gone to great lengths to wrest authority from the National Assembly, which has been dominated by a slate of opposition parties since early 2016. The country’s top court, which is packed with Maduro loyalists, had already invalidated every major law passed by Congress. On Wednesday, as part of a decision involving the executive branch’s authority over oil ventures, the court declared that henceforth the judicial branch would execute all powers normally reserved for the legislature.

The ruling provoked international condemnation and sent shock waves across the region. It also prompted a strikingly public rebuke from Luisa Ortega, a Maduro loyalist who serves as the nation’s chief prosecutor. She denounced the decision in a televised address during which she brandished a copy of Venezuela’s Constitution.  The court’s ruling represents a “rupture in the constitutional order,” Ms. Ortega said, speaking at the Public Ministry, which she leads. “We call for reflection so that democratic norms are followed,” she added, eliciting hearty applause from colleagues who appeared stunned by the gravity of the moment.

Venezuela court move may facilitate Russian investment, spook other oil majors

1 Apr 2017   Venezuela

The sight of Venezuela’s National Assembly president tearing up a Supreme Court ruling and warning foreign firms against making deals with the leftist government will no doubt resonate in international boardrooms. The ruling ripped up by Congress head Julio Borges on Thursday was designed to allow President Nicolas Maduro to create oil ventures without congressional approval, easing investment in the cash-strapped country’s floundering oil industry. And it may well facilitate deals with companies including Russia oil major Rosneft, which Reuters reported earlier this month had been offered a stake in an oil joint venture with Venezuelan state oil company PDVSA as part of a broader deal with Caracas’ key ally. But the […]

Cash-strapped Venezuela negotiating Russian help to pay PDVSA bonds: sources

1 Apr 2017   Prices, Venezuela

Venezuela is negotiating financial help from Russian oil major Rosneft to complete nearly $3 billion in PDVSA debt payments coming due to bondholders next month, two market sources and a government source familiar with the talks told Reuters on Friday. Venezuela’s leftist government has grown increasingly close to Russia’s Vladimir Putin and Rosneft has become an important financier and oil player in the OPEC nation with the world’s biggest crude reserves. The negotiations are happening even as political chaos reins in Venezuela after its Supreme Court annulled the opposition-led National Assembly’s powers to approve oil joint ventures, sparking protests and international condemnation. Earlier this month, Reuters reported PDVSA had offered a stake in the Petropiar joint venture to Rosneft, as part of what two sources told Reuters was […]

Nicolás Maduro’s power grab incites violent scuffles in Caracas

1 Apr 2017   Venezuela

Latin American dictators once sent in tanks and soldiers. This week, Venezuela’s socialist president Nicolás Maduro dispatched judges. The motivation, in part, is money. The result, however, is the same: a coup. Opposition leaders branded Mr Maduro “a dictator” and foreign governments decried the power grab after Venezuela’s government-controlled Supreme Court effectively annulled the National Assembly on Thursday, where the opposition won a majority in 2015 amid an unparalleled economic crisis that has left the country struggling to feed itself and on the brink of default. “This ruling represents a point of no return,” said Freddy Guevara, assembly vice-president. “This piece of rubbish . . . has kidnapped the liberty of Venezuela,” said Julio Borges, assembly president, ripping up the court ruling to wild cheers in the chamber. On Friday morning, violent scuffles broke out outside the Supreme Court as national guardsmen wielding truncheons clashed with students. Some opposition leaders have called for mass protests. But opposition appetite for an escalation of street fighting may be low after even 1m-strong anti-government marches in the past have produced no change. Related article Nicolás Maduro, Venezuela’s lord of misrule The isolated president sits tight as his country slides deeper into chaos, writes John Paul Rathbone The Supreme Court justified the ruling issued late on Wednesday night saying it flowed from Congress’ refusal to approve joint ventures between state-controlled oil company PDVSA and foreign energy companies, such as Russia’s Rosneft.

Guyana emerging as a new oil frontier

1 Apr 2017   Guyana

A discovery ff oil by Exxon Mobil off the coast of Guyana suggests the country is emerging as the sector’s next major hot spot, a regional player said. Exxon announced a new discovery at its Snoek well offshore Guyana earlier this week. It’s the third such discovery for the supermajor and drilling was in reservoirs similar to those previously encountered. In its declaration of discovery, Exxon said Snoek was part of a “significant,” but technically complex, offshore prospect. Attention to Guyana follows support from the International Monetary Fund of national plans to develop a legal framework for managing its oil wealth. The IMF said growth for Guyana was steady, but uneven, with a gain in real gross domestic product […]

Venezuela supreme court ruling raises dictatorship fears

31 Mar 2017   Venezuela

Venezuela’s supreme court, which is controlled by President Nicolás Maduro’s socialist government, has ruled it is taking over the opposition-dominated National Assembly, sparking fears that the crisis-riven country has moved towards full-blown dictatorship. Venezuela’s political factions have been at loggerheads since the opposition won control of the legislature in 2015 congressional elections, ending over a decade of near-complete governing control by the ruling socialist coalition. The court ruling was a sign “that the country’s political system is crumbling, and fast,” said Peter Schechter, senior vice-president of the Adrienne Arsht Latin America centre at the Atlantic Council in Washington DC. “If there was any doubt before, there should no longer be one: Venezuela is a dictatorship.” The Supreme Court has overturned almost every piece of legislation the assembly has passed since the opposition took control, arguing it only won due to voter fraud in three districts, the basis of its latest ruling. “The Constitutional Chamber shall ensure that the parliamentary powers are exercised directly by this Chamber or by the body it appoints to ensure the rule of law,” the decision said. The ruling late on Wednesday night was the first time it has said it would directly assume Congress’s functions. It added that it would now authorise Mr Maduro to create oil joint ventures, bypassing the constitutional need for Congressional approval.

Venezuela Muzzles Legislature, Moving Closer to One-Man Rule

31 Mar 2017   Venezuela

Venezuela took its strongest step yet toward one-man rule under the leftist President Nicolás Maduro as his loyalists on the Supreme Court seized power from the National Assembly in a ruling late Wednesday night. The ruling effectively dissolved the elected legislature, which is led by Mr. Maduro’s opponents, and allows the court to write laws itself, experts said. The move caps a year in which the last vestiges of Venezuela’s democracy have been torn down, critics and regional leaders say, leaving what many now describe as not just an authoritarian regime, but an outright dictatorship. “What we have warned of has finally come to pass,” said Luis Almagro, the head of the Organization of American States, a regional diplomacy group that includes Venezuela and is investigating the country for violating the bloc’s Democratic Charter. Mr. Almagro called the move a “self-inflicted coup,” a term used in […]

Brazil readies two new FPSOs for subsalt oil and natural gas output: Petrobras

31 Mar 2017   Brazil

Brazil is in the process of preparing two new floating production, storage and offloading vessels, or FPSOs, to start oil and natural gas production in the country’s record-setting subsalt frontier, state-led producer and refiner Petrobras said Thursday. The FPSO P-69 arrived at the Brasfels shipyard in Angra dos Reis, south of Rio de Janeiro, on Tuesday, Petrobras said. The vessel will have 18 processing modules installed onboard before heading out to start production at the Lula Extremo Sul area of the massive Lula Field in 2018, the company said. The new floating production units are part of eight that will be installed offshore Brazil over the next two years, according to Petrobras’ investment plan for 2017-2021. The ultra-deepwater region accounted for nearly 50% of Brazil’s total crude output in January, including a record 1.276 million b/d of oil and 49.53 million cu m/d of natural gas from 73 wells. […]

Maduro’s Last Stand: Military Takes Over Struggling Oil Sector

30 Mar 2017   Venezuela

As Venezuela’s foreign currency reserves have shrunk to $10.4 billion USD , so have the country’s goods in stock, against the background of gas, energy and medicine shortages, crime rates spiraling out of the government’s control and popular dissatisfaction building up across all sectors of society. The scarcity of the Maduro era is reflected in Venezuela’s oil output volumes, which since 2011 have fallen by almost 500 000 barrels per day to 2 mbpd and will sink to an even greater degree with Caracas’s obligation to reach 1.972 mbpd within the framework of the OPEC/non-OPEC Vienna Agreements. While Maduro have managed to avoid any major political destabilization by tightening control on the nation’s natural resources and is intent to see his 5-year tenure run out peacefully in 2018, his chances of retaining the post of Venezuela’s President beyond 2018 are close to naught. The latest moves signal that on […]

PDVSA Said to Be Preparing for Exit of President Del Pino

29 Mar 2017   Venezuela

Petroleos de Venezuela SA is preparing for the departure of its president Eulogio Del Pino in what would be the biggest management shift in years for the state-owned oil producer, people familiar with the plans said. Del Pino, 61, may depart by July and will be replaced by Nelson Martinez, Venezuela’s oil minister, said the people, who requested anonymity because the information isn’t public. Martinez, 65, would remain in his role as oil minister in addition to becoming head of PDVSA. The move would come after a board shakeup in January and the recent replacement of some refining managers. Del Pino has been in charge of PDVSA since 2014 and has worked at the company for about 30 years. He previously ran the energy producer while also serving as Venezuela’s oil minister, but in January the roles were split and Martinez, previously the head of U.S.-based unit Citgo Petroleum […]

Schlumberger sees Ecuador’s unpaid bills hurting quarterly results

29 Mar 2017   Ecuador

OPEC production cuts and economic woes are complicating Schlumberger NV’s (SLB.N) efforts to collect $1.1 billion from Ecuador’s state-owned Petroamazonas, casting a cloud over the oil services company’s first-quarter results.  “Continuing payment issues” in Ecuador are hurting earnings, Chief Executive Officer Paal Kibsgaard said in a text of a speech delivered at the Scotia Howard Weil energy conference in New Orleans on Monday.  Earlier this month, Kibsgaard wrote to Ecuadorean President Rafael Correa seeking to resolve an impasse over unpaid bills that he said was causing Schlumberger “considerable financial stress.”  Kibsgaard wrote that talks between top Schlumberger executives and Ecuadorean ministry officials since October “have made no real progress,” according to a copy of the letter seen by Reuters.  “The situation is obviously not sustainable in the long run,” he wrote, adding that Schlumberger was forced to expand debt to finance operations in the country.  Schlumberger did not respond to requests for comment.  Ecuador’s Ministry of Hydrocarbons declined to confirm the talks. The government has acknowledged some problems with payments to oil companies, without specifying which ones.

Venezuela increased fuel exports to allies even as supply crunch loomed

25 Mar 2017   Venezuela

A gasoline shortage in OPEC member Venezuela was exacerbated by an increase in government-sanctioned fuel exports to foreign allies and an exodus of crucial personnel from state-run energy company PDVSA [PDVSA.UL], according to internal PDVSA documents and sources familiar with its operations. Leftist-run Venezuela sells its citizens the world’s cheapest gasoline. Fuel supplies have continued flowing despite a domestic oil industry in turmoil and a deepening economic crisis under President Nicolas Maduro that has left the South American country with scant supplies of many basic necessities. That changed on Wednesday, when Venezuelans faced their first nationwide shortage of motor fuel since an explosion ripped through one of the world’s largest refineries five years ago. At the time, the government of then-President […]