8 ms·

They definitely can produce so much oil. Venezuela produces around 2 million barrels / day and are ranked no1 by proven oil reserve (https://en.wikipedia.org/wi

by IMTDb 8y ago

They definitely can produce so much oil. Venezuela produces around 2 million barrels / day and are ranked no1 by proven oil reserve (https://en.wikipedia.org/wiki/List_of_countries_by_proven_oil_reserves https://en.wikipedia.org/wiki/List_of_countries_by_proven_oi...) . So 1.5 billion barrels is completely in their range over several years ! No one said they need to repay the debt tomorrow, as long as they do not default on the foreign debt (which is the whole point of the move) they can restructure it and repay it at their own pace. The issue comes from the fact that during the last weeks/month, oil production has significantly dwindled due to political turmoil. Instead of defaulting on the foreign debt, they sacrificed their own population. They do not need to create 20x the value they created before. The USD price of a Kilogram of coffee did not change at all, so any amount of coffee they would be selling now will contribute the exact same amount towards foreign debt reduction than the same amount produced 3 month ago: they don't suddenly need to produce 20x more. On the other hand, if they did sell a significant amount of coffee 3 month ago and saved the profits in bolivars for their old days, or to invest in modernising the farm, their savings just got divided by 20.

JoeAltmaier 8y ago
Isn't it sulfur-laden oil, of no interest in the market unless there's a demand shortage? And in the current market, there's slumped demand, so they can't give it away. Also, renovation of the Venezuelan infrastructure was paid for but not accomplished (graft/corruption). So they're in a hole for efficient production? Finally, food production: they divided up farms and gave small holdings to the workers, who unfortunately had not the education, equipment nor capital to run them. So food supplies tanked, resulting in foreign exchange being used principally to import food. All this added up to, a total fail of the regime to pay for their socialist experiment? Never mind games with imaginary points (currency valuation). The country can't feed itself nor make its own food nor trade its resources for food. They're in a big hole.
- curtisblaine 8y ago
  Their socialist experiment was unsustainable from the start, to be fair. They effectively killed their internal economy by capping the price of staple goods, driving business to failure and closure in the process.
  - 49para 8y ago
    That is just because they used the wrong version of Socialism. They just need to switch to a working version and they should be good. /s
    - gameswithgo 8y ago
      like denmark, germany, etc?
      - antidesitter 8y ago
        Denmark and Germany are not socialist.
        arcticbull 8y ago
        Denmark is actually, literally, in the Merriam-Webster definition of Social Democracy / Democratic Socialism. [1] Your one-word denials are unhelpful and uninteresting. Cite some sources and make a case. [1] https://www.merriam-webster.com/dictionary/social%20democracy https://www.merriam-webster.com/dictionary/social%20democrac...
        antidesitter 8y ago
        You are confusing democratic socialism with social democracy. This is a common mistake, but you should understand the difference.
        TheCoelacanth 8y ago
        So should literally every single person every commenting on US politics ever, because pretty much no person in recent history who has ever come close to holding any federal elected office in the US has ever advocated for actual socialism, even the people who self-identify as socialists like Bernie Sanders or Alexandria Ocasio-Cortez. If you use the real definition of socialism, you might as well say "the US should not adopt Nazism" as "the US should not adopt socialism" because both are equally likely to actually be adopted (i.e. not very likely at all). No mainstream politician in the US is suggesting that the state should take over ownership of most private businesses.
- atombender 8y ago
  Yes, their oil has to be refined a lot more than other types [1]: > Venezuela produces extra-heavy crude oil in the Orincoco Oil Belt area and heavily relies on imports of lighter liquids (diluents) to blend with this crude oil to make it marketable. Financial difficulties recently have occasionally prevented the state-owned oil company, Petroleos de Venezuela SA (PdVSA), from importing the necessary volumes of diluent to sustain production and exports. [1] https://www.eia.gov/todayinenergy/detail.php?id=35312 https://www.eia.gov/todayinenergy/detail.php?id=35312
sonnyblarney 8y ago
Their Oil is 'tarsands' type Oil and it's the most difficult to produce and requires a lot of processing = massive investment that few are willing to make because a) market volatility and b) government volatility. It's funny because 'stability and predictability' alone would yield them the kind of business climate and interest rates they would need to attract investment and they'd be much richer as a result.
- meiraleal 8y ago
  > It's funny because 'stability and predictability' alone would yield them the kind of business climate and interest rates they would need to attract investment and they'd be much richer as a result. Mexico, Brazil, Argentina and Colombia proves that your point is not right.
  - antidesitter 8y ago
    > Mexico, Brazil, Argentina and Colombia proves that your point is not right. How so?
  - sonnyblarney 8y ago
    None of those countries have stable politics and economies, and certainly none of them have vast amounts of Oil Sands that require investment. If they were like Japan, or Germany, or Sweden - they would get tons of investment. Canada is the 'other country' that has vast Oil Sands and we get billions invested to extract it. The volatility is only in the market demand side, not the geopolitics side.
2trill2spill 8y ago
The fact that this list puts the United States at 11th in Oil reserves is highly suspect. Also your source even says that the list is unreliable [1]. I personally wouldn't use this list as a source. Also if Venezuela starts increasing its production beyond 2 million barrels per day they could help to lower crude prices, which would probably have a negative effect on them and other OPEC countries. [1]: "Some statistics on this page are disputed and controversial. Different sources (OPEC, CIA World Factbook, oil companies) give different figures. Some of the differences reflect different types of oil included. Different estimates may or may not include oil shale, mined oil sands or natural gas liquids."
- nostrademons 8y ago
  At $100/barrel the U.S. has the largest oil reserves in the world by far: https://en.wikipedia.org/wiki/Oil_shale_reserves https://en.wikipedia.org/wiki/Oil_shale_reserves https://en.wikipedia.org/wiki/Oil_shale_economics https://en.wikipedia.org/wiki/Oil_shale_economics Even with conventional oil, though, 11th place worldwide seems reasonable, particularly compared to neighboring countries (behind Nigeria and ahead of Kazakhstan, China, and Qatar). Don't forget that the U.S. still has very active oil production in Alaska, Southern California, Texas/Oklahoma, and the offshore Gulf of Mexico.
cryptonector 8y ago
Not 2 million barrels / day[0]. [0] https://tradingeconomics.com/venezuela/crude-oil-production https://tradingeconomics.com/venezuela/crude-oil-production
jimmywanger 8y ago
> They definitely can produce so much oil. Venezuela produces around 2 million barrels / day and are ranked no1 by proven oil reserve One thing I find interesting is that Venezuela might have the number 1 oil reserves, and that's repeated over and over. Their oil is garbage (extremely heavy) and requires the importation of dilutants paid for by foreign currency, as well as equipment and specialized engineers that are paid for by foreign currency as well. If the prices of oil are too low, it doesn't matter how much oil is under the land they're sitting on. It's going to stay there until kingdom come.

by IMTDb 8y ago

JoeAltmaier 8y ago

Isn't it sulfur-laden oil, of no interest in the market unless there's a demand shortage? And in the current market, there's slumped demand, so they can't give it away. Also, renovation of the Venezuelan infrastructure was paid for but not accomplished (graft/corruption). So they're in a hole for efficient production? Finally, food production: they divided up farms and gave small holdings to the workers, who unfortunately had not the education, equipment nor capital to run them. So food supplies tanked, resulting in foreign exchange being used principally to import food. All this added up to, a total fail of the regime to pay for their socialist experiment? Never mind games with imaginary points (currency valuation). The country can't feed itself nor make its own food nor trade its resources for food. They're in a big hole.

curtisblaine 8y ago
Their socialist experiment was unsustainable from the start, to be fair. They effectively killed their internal economy by capping the price of staple goods, driving business to failure and closure in the process.
- 49para 8y ago
  That is just because they used the wrong version of Socialism. They just need to switch to a working version and they should be good. /s
  - gameswithgo 8y ago
    like denmark, germany, etc?
    - antidesitter 8y ago
      Denmark and Germany are not socialist.
      - arcticbull 8y ago
        Denmark is actually, literally, in the Merriam-Webster definition of Social Democracy / Democratic Socialism. [1] Your one-word denials are unhelpful and uninteresting. Cite some sources and make a case. [1] https://www.merriam-webster.com/dictionary/social%20democracy https://www.merriam-webster.com/dictionary/social%20democrac...
        antidesitter 8y ago
        You are confusing democratic socialism with social democracy. This is a common mistake, but you should understand the difference.
        TheCoelacanth 8y ago
        So should literally every single person every commenting on US politics ever, because pretty much no person in recent history who has ever come close to holding any federal elected office in the US has ever advocated for actual socialism, even the people who self-identify as socialists like Bernie Sanders or Alexandria Ocasio-Cortez. If you use the real definition of socialism, you might as well say "the US should not adopt Nazism" as "the US should not adopt socialism" because both are equally likely to actually be adopted (i.e. not very likely at all). No mainstream politician in the US is suggesting that the state should take over ownership of most private businesses.
atombender 8y ago
Yes, their oil has to be refined a lot more than other types [1]: > Venezuela produces extra-heavy crude oil in the Orincoco Oil Belt area and heavily relies on imports of lighter liquids (diluents) to blend with this crude oil to make it marketable. Financial difficulties recently have occasionally prevented the state-owned oil company, Petroleos de Venezuela SA (PdVSA), from importing the necessary volumes of diluent to sustain production and exports. [1] https://www.eia.gov/todayinenergy/detail.php?id=35312 https://www.eia.gov/todayinenergy/detail.php?id=35312

sonnyblarney 8y ago

Their Oil is 'tarsands' type Oil and it's the most difficult to produce and requires a lot of processing = massive investment that few are willing to make because a) market volatility and b) government volatility. It's funny because 'stability and predictability' alone would yield them the kind of business climate and interest rates they would need to attract investment and they'd be much richer as a result.

meiraleal 8y ago
> It's funny because 'stability and predictability' alone would yield them the kind of business climate and interest rates they would need to attract investment and they'd be much richer as a result. Mexico, Brazil, Argentina and Colombia proves that your point is not right.
- antidesitter 8y ago
  > Mexico, Brazil, Argentina and Colombia proves that your point is not right. How so?
- sonnyblarney 8y ago
  None of those countries have stable politics and economies, and certainly none of them have vast amounts of Oil Sands that require investment. If they were like Japan, or Germany, or Sweden - they would get tons of investment. Canada is the 'other country' that has vast Oil Sands and we get billions invested to extract it. The volatility is only in the market demand side, not the geopolitics side.

2trill2spill 8y ago

The fact that this list puts the United States at 11th in Oil reserves is highly suspect. Also your source even says that the list is unreliable [1]. I personally wouldn't use this list as a source. Also if Venezuela starts increasing its production beyond 2 million barrels per day they could help to lower crude prices, which would probably have a negative effect on them and other OPEC countries. [1]: "Some statistics on this page are disputed and controversial. Different sources (OPEC, CIA World Factbook, oil companies) give different figures. Some of the differences reflect different types of oil included. Different estimates may or may not include oil shale, mined oil sands or natural gas liquids."

nostrademons 8y ago
At $100/barrel the U.S. has the largest oil reserves in the world by far: https://en.wikipedia.org/wiki/Oil_shale_reserves https://en.wikipedia.org/wiki/Oil_shale_reserves https://en.wikipedia.org/wiki/Oil_shale_economics https://en.wikipedia.org/wiki/Oil_shale_economics Even with conventional oil, though, 11th place worldwide seems reasonable, particularly compared to neighboring countries (behind Nigeria and ahead of Kazakhstan, China, and Qatar). Don't forget that the U.S. still has very active oil production in Alaska, Southern California, Texas/Oklahoma, and the offshore Gulf of Mexico.

cryptonector 8y ago

Not 2 million barrels / day[0]. [0] https://tradingeconomics.com/venezuela/crude-oil-production https://tradingeconomics.com/venezuela/crude-oil-production

jimmywanger 8y ago

> They definitely can produce so much oil. Venezuela produces around 2 million barrels / day and are ranked no1 by proven oil reserve One thing I find interesting is that Venezuela might have the number 1 oil reserves, and that's repeated over and over. Their oil is garbage (extremely heavy) and requires the importation of dilutants paid for by foreign currency, as well as equipment and specialized engineers that are paid for by foreign currency as well. If the prices of oil are too low, it doesn't matter how much oil is under the land they're sitting on. It's going to stay there until kingdom come.