Oil rich Venezuela too poor to sell its oil

oil rich venezuela

Venezuela in olive green, PetroCaribe members in light and dark green (map by Wiz9999).

PRAYER ALERT on oil rich Venezuela. Venezuela possesses the largest reserves of oil in the world. But it has become too poor to process and transport the oil. Not only are Venezuela’s port facilities and infrastructure crumbling. It even lacks the money to remove the water from much of the crude oil it is extracting.

Therefore Venezuela is missing out on huge profits from the highest crude oil prices in years. This month its biggest customer, China, will only get half the amount of oil it used to receive from Venezuela. Moreover, Venezuela has warned eight PetroCaribe customers that it can’t supply the required 1.5 million barrels per day in June. In fact, Venezuela has less than half that much available to export.

So it is telling those eight PetroCaribe customers—Belize, Antigua and Barbuda, Dominica, El Salvador, Haiti, Nicaragua, St. Vincent and the Grenadines and St. Kitts and Nevis—that they may have to accept new delivery terms. Specifically, those countries may have to send ships to receive costlier and riskier transfers of oil at sea.

But how will those PetroCaribe countries pay? Venezuela lost most of its corresponding banking relationships with the US. So Belize, for example, cannot pay the US $16 million it owes to Venezuela until it finds another payment arrangement. In the meantime, Venezuela has suspended providing oil to Belize until it does pay. Now Belize is paying increasingly higher prices for oil from other sources.

The PetroCaribe deal used to be a big cash cow for Belize. Not only did it provide cheap oil. It offered loans at two percent annually. From 2005-2015 the Belize government spent about $300 million through PetroCaribe financing, at times for controversial purposes. Now the breakdown of that lucrative deal has deepened Belize’s recession and resulting poverty.

PRAY WITH US. Father God, all honor and wealth and power belongs to You. You have immeasurable riches in glory. Furthermore, You have hidden riches in the earth for us to find and serve You with. You seek good and faithful servants, who will multiply those riches for Your glory. But we confess that we have squandered Your riches. Venezuela has used its vast oil wealth to prop up a godless socialist state. Now that failed state cannot even prop up its oil production. Belize and other PetroCaribe states grew dependent on rich Venezuela’s loans. Now they suffer because they did not look to You as their source.

So we exalt You as the true source. Every good and perfect gifts comes from You, who does not change like shifting shadows. So show us Your plans to prosper us and not to harm us. Find good and faithful servants with Your wisdom to increase, in Venezuela, Belize and all the PetroCaribe countries. Help them pray and prepare the way out of recession into growth. Also, expose and clear out the obstacles of corruption, vested interests and mismanagement. Set them on a course for justice and opportunity for all. And exalt Jesus and Your Word as the only sure guide toward a bountiful future. In Jesus’ name, amen.

Read more

DailyInsight. “Wealth obtained by vanity dwindles, but the one who gathers gradually increases” (Prov. 13:11).

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