Venezuela’s crude oil production

Venezuela is OPEC’s eighth-largest crude oil producer. The U.S. Energy Information Administration estimates that Venezuela’s crude oil output decreased by 65,000 bpd (barrels per day) to 1,360,000 bpd in June—compared to the previous month. The production is near a 16-year low.

The drop in production and exports has been supporting oil prices since July 2017. Brent and WTI oil prices increased 0.5% and 0.9%, respectively, on July 24. The iShares US Energy ETF (IYE) rose ~1.24% to $41.63 on July 24. The index is composed of US companies in the energy sector. Pioneer Natural Resources (PXD), Continental Resources (CLR), Oasis Petroleum (OAS), and Nabors (NBR) rose 3.23%, 2.63%, 2.6%, and 2.3%, respectively, on July 24. These stocks were the top percentage gainers in IYE’s holdings. These stocks account for ~2.6% of IYE holdings.

Venezuela’s Crashing Oil Production Supports Oil Bulls

Venezuela’s production

Venezuela’s oil production has dropped 60% or by ~2.04 MMbpd (million barrels per day) from the record high in December 1997. Venezuela’s production has declined by 820,000 bpd or 38% in the last two years.

Relatively low global crude oil prices, high debt, a lack of investment in crude oil exploration and production activity, electricity outages, port congestion, and high inflation weighed on Venezuela’s oil industry. Replacing technical people with a military commander to run PDVSA and mass employee resignations have also weighed on the country’s oil industry.


Venezuela’s president aims to increase the country’s crude oil production by 1 MMbpd from the current production of 1.36 MMbpd. China Development Bank is expected to invest more than $250 million to boost Venezuela’s crude oil production.

However, Venezuela’s crude oil production could fall by 1 MMbpd, according to Bloomberg. High debt and mismanagement of Venezuela’s oil industry could lead to lower production. A decline in Venezuela’s production would support oil prices.

Read Is Oversupply Risk Weighing on the Crude Oil Market? and Supplies and Weather Drive US Natural Gas Prices for the latest updates on crude oil and natural gas.

Latest articles

Apple Arcade (AAPL) is a subscription gaming service that was unveiled at Apple’s annual event last week. The service will launch on September 19.

Cannabis legalization is gaining traction not only in the US but also globally. The third presidential Democratic debate was held on September 12.

Google has agreed to make a one-time settlement of over $945 million euros to the French ministry. The ministry accused Google of evading taxes.

In Q4 2018, legendary investor George Soros sold all his holding in Apple (AAPL). In Q3 2018, Apple represented around 0.2% of his total portfolio.

Jim Chanos, the founder and president of Kynikos Associates, is a long-time short-seller of Tesla stock. Tesla stock has fallen 17.5% in the last year.

Despite Aurora Cannabis's subdued results, Cowen initiated coverage on five cannabis stocks: CRLBF, GTBIF, CURLF, MMNFF, and ACRGF.