If high inventories of oil and continually declining prices are providing huge headaches for even the most powerful companies in the global oil & gas sector, these days, this applies doubly for Guyana’s western neighbour, Venezuela, believed to possess the single largest oil reserves in the world. However that country is being humiliatingly ground down by the twin forces of a domestic socio-political crisis that has created varying degrees of refugee challenges for its neighbours, on the one hand, and on the other, the relentless economic pressure being applied by the United States to force the incumbent president in Caracas, Nicholas aduro, out of office.
Washington’s prolonged offensive against Maduro has mostly taken aim at the heart of the country’s economy, its oil industry (the Stabroek Business has been publishing occasional periodic reports on aspects of the US/Venezuela oil-driven political confrontation). Essentially, what Washington has done is to brandish sanctions as a threat that has scared all but a handful of oil and shipping companies away from doing business with Venezuela’s oil industry. The Russians and the Chinese have provided some measure of pushback against those threats, whilst the US administration, recognising that its own giant oil company, Chevron, which has been long embedded in Venezuela and stands to lose possibly billions by quitting the country, has agreed to have the company stay on in Caracas, courtesy of a series of waivers to exit deadlines, the most recent and rumoured to be the final one, ending this month.
