Venezuela’s government is sinking in a sea of oil It has nearly as much crude reserves as the US and Saudi Arabia combined. So how come Venezuela's oil production and exports are slipping and the public is raging in the streets?
Oil troubles have helped drain Venezuela's hard currency reserves and exacerbate shortages of basic goods, leading to price gouging and fueling public anger.
Venezuela uses its oil as a political reward to likeminded governments in the region — hardly a way to close fiscal gaps. And the state takeover of the oil industry has proven a disaster, with production plummeting and investment lagging.
What's more, Venezuela is providing over 200,000 bpd more to Beijing at no charge as a down payment on more than $40 billion in Chinese loans extended during the Chavez years, according to the EIA.
Add another 400,000 bpd transferred at below-market prices to regional Bolivarian brethren — including Cuba, Nicaragua and a host of small Caribbean islands — and it's no wonder the Venezuelan currency, the bolivar, fell 73 percent against the dollar in 2013.