Venezuela: Venezuelan oil prices rise in May
June 10, 2015
In May, the average price of Venezuela’s mix of crude oil rose 11.6% over the previous month, hitting USD 56.4 per barrel. The reading was above the 7.2% increase recorded in April.
According to the latest report from the Organization of Petroleum Exporting Countries (OPEC), Venezuelan oil production totaled 2.36 million barrels per day (mbpd) in May, which was slightly below April’s 2.38 million barrels per day.
The Venezuelan government relies heavily on oil revenues to balance its budget and to comply with its international obligations. Oil accounts for about 95% of Venezuela’s exports and for more than half of public sector revenues. The recent plunge in oil prices is expected to put additional pressure on the country’s battered finances. While the 2015 budget assumes an oil price of USD 60 per barrel, analysts point out that the government needs a breakeven oil price that is well above USD 100 per barrel and that the country loses USD 700 million a year for every USD 1 decline in oil prices.