Oil-dependent Venezuela's crude output dipped last month below 2 million barrels per day, its lowest level in nearly three decades, global producer group Opec said on Monday. The output fall could not come at a worse time, with the economy in crisis and the socialist government struggling to pay its foreign debt. The government opens talks on Monday with creditors to renegotiate its debt and avert a default that would plunge its economy into deeper trouble.
Compounding the situation, another eight managers and employees of state oil company PDVSA in eastern Venezuela were arrested in recent days for fiddling production figures, chief prosecutor Tarek Saab told reporters. In a major corruption sweep engulfing the oil sector, about two dozen high-level executives have already been arrested in recent weeks, ridding PDVSA of much of its top brass.
The Organization of the Petroleum Exporting Countries' latest monthly data showed Venezuela reporting production of 1.955 million bpd in October, versus 2.085 million in September. The figure was even lower based on secondary sources rather than what the government reports, at 1.863 million bpd in October, according to Opec.
Venezuela depends on oil for more than 95 percent of hard currency export revenues, fuelling both social welfare programs and payment on some $60 billion of outstanding bonds. PDVSA is the financial motor for President Nicolas Maduro's government, but has been suffering from the oil price drop, crippling operational problems, and internal corruption.