Venezuelan oil minister Rafael Ramirez urged Opec on Sunday to agree to reduce supply by 1 million barrels per day at an emergency meeting in Cairo November 29 and make the cut take effect before the end of the year.
The cut would be aimed at shoring up prices by creating a better balance between supply and demand on oil markets, which Ramirez said are currently oversupplied by at least 1 million barrels per day.
Venezuela, a major supplier to the United States, is a price hawk in Opec. Oil prices have fallen about $100 a barrel since July, slashing Venezuela's income from its main export.
Despite the low prices, which make some projects with high operational costs less attractive, foreign companies remain interested in developing Venezuela's reserves. Twenty-one foreign companies this month bought $2 million data packs to prepare possible bids to develop fields in the Orinoco oil belt, Ramirez said.
Venezuela is even considering including additional Orinoco areas in the bidding contest, which takes place next year, because it considers 21 companies a reflection of high interest in its oil, Ramirez said.
Venezuela has some of the largest oil reserves outside of the Middle East. But companies cannot ignore the risk of doing business in the South American country. The government of socialist President Hugo Chavez has imposed a high tax regime on projects and last year nationalised multibillion dollar Orinoco operations, stripping major companies of their assets.
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