Where Is The Money From Venezuela's Oil?

The proven oil reserves in Venezuela are recognized as the largest in the world, totaling 300 billion barrels (4.8×10^x grand³) every bit of 1 January 2014.^[1] The 2019 edition of the BP Statistical Review of Earth Free energy reports the total proved reserves of 303.3 billion barrels for Venezuela (slightly more than Saudi Arabia'southward 297.seven billion barrels).^[2]

Venezuela'south crude oil is very heavy by international standards, and as a outcome much of it must be candy past specialized domestic and international refineries.

History [edit]

Venezuela's development of its oil reserves has been affected past political unrest. In late 2002, nearly half of the workers at the state oil company PDVSA went on strike, later which the company fired 18,000 of them, draining the company of technical cognition and expertise.

Growth [edit]

As of 2006, Venezuela was one of the largest suppliers of oil to the United States, sending most ane.4 1000000 barrels per day (220×10 ^ ⁱⁱⁱ k³/d) to the U.South.^[3]

In Oct 2007, the Venezuelan government said its proven oil reserves was 100 billion barrels (sixteen×10 ^ ⁹ m³). The energy and oil ministry building said it had certified an additional 12.four billion barrels (2.0×10 ^ ⁹ grand³) of proven reserves in the country's Faja del Orinoco region.^[4] In February 2008, Venezuelan proven oil reserves were 172 billion barrels (27×x ^ ⁹ thou³).^[5] By 2009, Venezuela reported 211.17 billion barrels (3.3573×10¹⁰ thou³) of conventional oil reserves, the largest of whatever country in South America.^[6] When 2015 ended, Venezuela'south confirmed oil reserves were estimated to be around 300.nine billion barrels in total.

In 2008, information technology had net oil exports of one.189 Mbbl/d (189,000 yard³/d) to the United states of america.^[seven] As a result of the lack of transparency in the state'due south accounting, Venezuela's truthful level of oil production is hard to decide, only OPEC analysts estimate that it produced around 2.47 Mbbl/d (393,000 m³/d) of oil in 2009, which would requite it 234 years of remaining product at current rates. In 2010 Venezuela reportedly produced 3.1 millions barrels of oil daily and exporting 2.iv meg of those barrels per day. Such oils exports brought in $61 billion for Venezuela.^[8] However, Venezuela just endemic about $ten.5 billion in foreign reserves, meaning that its debt remained at $7.two billion when 2015 rang out.^[9]

Collapse [edit]

After the 2014 oil crash, "Venezuela descended into anarchy with hyperinflation, severe shortages of about appurtenances, fighting on the streets, and many people fleeing to other countries."^[ten] Venezuela owned the Citgo gasoline chain,^[3] but U.South. sanctions as of 2019 prevent Venezuela from receiving economic benefit from Citgo.^[xi] In 2019, information technology was among the oil consign countries who had lost the most from free energy transition; it was ranked 151 out of 156 countries in the index of Geopolitical Gains and Losses (GeGaLo).^[10]

Venezuela's oil exports were "expected to internet about $2.three billion" past the end of 2020, whereas a decade earlier the country had been "the largest producer in Latin America, earning about $ninety billion a twelvemonth" from these exports. A New York Times article noted that, in October 2020, "for the commencement time in a century, there are no rigs searching for oil in Venezuela."^[12]

Orinoco Belt [edit]

Orinoco Chugalug assessment unit, USGS

In addition to conventional oil, Venezuela has oil sands deposits similar in size to those of Canada, and approximately equal to the globe's reserves of conventional oil. Venezuela'southward Orinoco oil sands are less viscous than Canada's Athabasca oil sands – pregnant they can be produced by more than conventional ways – but they are buried too deep to be extracted past surface mining. Estimates of the recoverable reserves of the Orinoco Belt range from 100 billion barrels (16×10 ^ ⁹ 1000³) to 270 billion barrels (43×ten ^ ⁹ chiliad³). In 2009, the USGS updated this value to 513 billion barrels (8.xvi×10¹⁰ m³).^[13]

According to the USGS, the Orinoco Belt alone is estimated to incorporate 900–1,400 billion barrels (2.ii×x^eleven mⁱⁱⁱ) of heavy crude in proven and unproven deposits.^[14] Of this, the USGS estimated that 380–652 billion barrels (1.037×10^xi m³) could be technically recoverable, which would make Venezuela's total recoverable reserves (proven and unproven) among the largest in the world.^[xv] ^[16] The technology needed to recover ultra-heavy crude oil, such as in most of the Orinoco Chugalug, may exist much more complex and expensive than that of Saudi Arabia'due south light oil industry.^[17] The USGS did not make any endeavor to decide how much oil in the Orinoco Belt is economically recoverable.^[13] Unless the price of crude rises, it is likely that the proven reserves will have to be adjusted downward.^[18]

History of Venezuela's claimed reserves (red) in comparison to those of Saudi arabia (blueish)

Comparison to Saudi Arabia [edit]

main topic: Oil reserves in Kingdom of saudi arabia

In early 2011, so-president Hugo Chávez and the Venezuelan government appear that the nation's oil reserves had surpassed that of the previous long-term world leader, Saudi arabia.^[17] OPEC said that Saudi Arabia's reserves stood at 265 billion barrels (4.21×10¹⁰ kⁱⁱⁱ) in 2009.^[19]

While Venezuela has reported "proven reserves" topping those reported by Kingdom of saudi arabia, manufacture analyst Robert Rapier has suggested that these numbers reflect variables driven by changes in crude oil marketplace prices—indicating that the percentage of Venezuela'south oil that qualifies as Venezuela'southward "proven" reserves may be driven up or downwards by the global market price for crude oil.^[20]

Co-ordinate to Rapier, Venezuela's oil reserves are largely of "extra-heavy rough oil" which might "not be economic to produce" nether certain market conditions. (Reuters columnst John Kemp reports that Venezuela'due south "very dense crudes... are complicated to process," and are priced at a "large discount," when compared to the crudes of other producers.^[21]) Rapier notes that the near-quadrupling of Venezuela's claimed "proven" reserves, betwixt 2005 and 2014—from eighty Gbbl to 300 Gbbl—may have been due to soaring crude oil prices that made Venezuela's normally uneconomical heavier crude all of a sudden market place-viable to produce, and thus elevating information technology to inside Venezuela's "proven" reserves. Consequently, Rapier contends, periods of lower crude oil market prices may remove those reserves from the "proven" category—placing Venezuela'southward feasible "proven reserves" well below Saudi Arabia's.^[xx]

By comparison, Rapier contends, the lighter crude more often than not associated with Saudi oil fields is cost-effective to produce under most market-price conditions, and thus is more than consistently, and uniformly, part of Saudi Arabia's "proven" reserves, compared to the more than variable usefulness of the Venezuelan oil.^[20]

References [edit]

^ BP, Statistical review of world energy Archived June 9, 2015, at the Wayback Machine, June 2014.
^ [one] 2019 BP Statistical Review of Globe Energy.
^ ^a ^b "Venezuela Oil". Country Analysis Briefs. US Free energy Data Administration. 2007. Archived from the original on 2008-04-12. Retrieved 2008-04-27 .
^ Matthew Walter (2007-x-07). "Venezuela'due south Proven Oil Reserves Rise to 100 billion barrels (xvi×10 ^ ^ix mⁱⁱⁱ)". Bloomberg. Retrieved 2008-01-05 .
^ "OPEC Facts and figures". Archived from the original on February 21, 2010. Retrieved xiii March 2010.
^ OPEC data at opec.org
^ Eia information Archived 2010-xi-18 at the Wayback Machine at tonto.eia.doe.gov
^ "Venezuelan oil production may tumble xx% by the cease of 2017".
^ "Venezuelan Oil Production - Analysis of Venezuelan Oil Industry".
^ ^a ^b Overland, Indra; Bazilian, Morgan; Ilimbek Uulu, Talgat; Vakulchuk, Roman; Westphal, Kirsten (2019). "The GeGaLo index: Geopolitical gains and losses later energy transition". Energy Strategy Reviews. 26: 100406. doi:10.1016/j.esr.2019.100406.
^ Parraga, Marianna (Feb 26, 2019). "Citgo formally cuts ties with Venezuela-based parent company". Reuters . Retrieved June 7, 2019.
^ Urdaneta, Sheyla; Kurmanaev, Anatoly; Herrera, Isayen; Fernandez, Adriana Loureiro (seven October 2020). "Venezuela, One time an Oil Behemothic, Reaches the End of an Era". The New York Times. ISSN 0362-4331. Retrieved 8 October 2020.
^ ^a ^b Christopher J. Schenk; Troy A. Cook; Ronald R. Charpentier; Richard Grand. Pollastro; Timothy R. Klett; Marilyn Due east. Tennyson; Mark A. Kirschbaum; Michael Eastward. Brownfield & Janet K. Pitman. (eleven January 2010). "An Approximate of Recoverable Heavy Oil Resources of the Orinoco Oil Belt, Venezuela" (PDF). USGS. Retrieved 23 January 2010.
^ Gonzalez, O., Ernandez, J., Chaban, F., and Bauza, L. (2006). "Screening of suitable exploitation technologies on the Orinoco Oil Belt applying geostatistical methods". World Heavy Oil Conference, Beijing, China November 12–15, 2006 Proceedings. Vol. Newspaper 2006–774. p. 12. {{cite volume}}: CS1 maint: multiple names: authors list (link)
^ Schenk C.J., Melt, T.A., Charpentier, R.R., Pollastro, R.M., Klett, T.R., Tennyson, M.E., Kirschbaum, M.A., Brownfield, M.East., and Pitman, J.K. (2009). "An approximate of recoverable heavy oil resources of the Orinoco Oil Belt, Venezuela: U.Southward. Geological Survey Fact Sheet 2009–3028". {{cite web}}: CS1 maint: multiple names: authors listing (link)
^ Venezuela oil 'may double Kingdom of saudi arabia' BBC
^ ^a ^b Venezuela: Oil reserves surpasses Saudi Arabia's at english.ahram.org.eg
^ "Venezuela's Oil Reserves Are Probably Vastly Overstated".
^ Venezuela Says Oil Reserves Surpass Kingdom of saudi arabia's Reuters at CNBC.
^ ^a ^b ^c Rapier, Robert, "How Much Oil Does Saudi Arabia Really Have?" Feb 14, 2019, Forbes, retrieved May 27, 2020
^ Kemp, John, "Column: Venezuela sanctions get out oil market short of heavy rough - Kemp," February 12, 2019, Reuters News Service, retrieved May 27, 2020.