Venezuela seeks to slash oil production costs

Venezuelan Energy and Oil Minister Rafael Ramirez vowed in an interview to slash production costs by 40 percent in hopes of making up for low oil prices that has put a hole in his country's budget. Cost-cutting would include re-negotiating deals with contractors that were reached when oil prices were at record-high 2008 levels, he said.
Venezuela, one of the world's top oil producers, has seen the price of its oil plunge from more than 130 dollars a barrel in mid-2008 to 36.8 dollars late last week. The government planned for oil at 60 dollars a barrel in its 2009 budget, officials said.
To make up for the dramatic downfall, Ramirez said in an interview with Radio Union late Monday that the state-owned oil concern Petroleos de Venezuela (PDVSA) would aim to cut production costs by 40 percent. Some of the savings, he said, will be obtained by re-negotiating oil service contracts.