Venezuela: Turmoil in the Middle East and weakening dollar push oil prices up
June 10, 2011
In April, the average price of the Venezuelan mix of crude oils rose 8.1% over the previous month to reach USD 107.54 per barrel (March: USD 99.48 per barrel). The price spike was fuelled the weakening of the U.S. dollar against most other currencies and the ongoing unrest in North Africa and the Middle East. According to the latest report from the Organization of the Petroleum Exporting Countries (OPEC), in March oil production in Venezuela increased to 2.32 million barrels per day (mbpd) from 2.27 mbpd in February. In contrast, crude output in Libya plunged from 1.36 mbpd to just 0.37 mbpd. Meanwhile, the government set a 95% tax on oil windfall revenues obtained by PDVSA and its joint ventures, when oil prices fluctuate above USD 100 per barrel. These funds will be allocated to the National Development Fund (Fonden), an off-budget development fund under discretional control of the Chavez administration.