Today's Local Intelligence: Venezuela
Our Venezuelan expert shares his take on the current political and economic situation in the country and shares insights sourced directly from the ground. To learn more, read on.
‘Luis’ is our highly experienced oil expert with over 12 years of experience as a political risk analyst.
“Venezuela’s situation is sadly ironic. There is no civil war or conflict per se, but yet industries are collapsing and basic public services are being disrupted on a daily basis.”
The country’s main industry, previously producing up to 5 million barrels a day, is in such a crisis that it is barely producing 500k barrels today. All aspects of the supply chain are in trouble - upstream, downstream, refining, shipping. To recover the oil industry, the human capital that fled the country and billions of dollars of investment will be needed.
‘Luis’ reports that only a serious political reform in the coming months could reverse the collapse. However, with extreme political uncertainty and huge divisions within the opposition, the current regime is unlikely to fall in the next two to three years. Plagued by corruption, lack of legal framework, and weak rule of law, other sectors that could promote growth such as gold and tourism, are not in a position to do so. Venezuela continues to run towards an uncertain future.
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