Graph of the day



I’m not sure what the calculations were to get at this number, but the figure is significantly lower than Monaldi’s estimate of $200 as a breakeven price. Regardless, we’re far from where we would like to be.

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  1. That graph suggests a 25% shortfall on required oil income, which translates roughly into a 12%-of-GDP budget deficit for the year (making the big-ass assumption of oil income representing 50% of the budget).

    Considering that budget deficit estimates for this year hover around 15-20% of GDP for fiscal 2014 ( for more info), either this estimate falls short, either Venezuela has become even more reliant on oil revenue (maybe due to the erosion of real domestic tax income), or the market estimates for oil prices point to an even lower price for the closure of this year… Very bad news in any case.

  2. Based on this, the only ones working on a profit are Kuwait, UAE and Dubai. The rest are working under water and it will be even worst if we protect this numbers based on the European economy forecast.
    Raul C will be lobbing around DC to find a new padrino because the golden hen is screwed

    • … which Google translates as “You’re a petro-state, have oil and you need 90 silver. You’re an idiot and everything will go to hell.”

      “se ira a la mierda.” translates as “You will go to hell.”

      However “la mierda” does NOT translate as “hell”, of course.

      Is Google euphemizing, or is that usage a traditional Spanish idiom? Inquiring gringos want to know.

  3. Guys.

    Petroestados not covered in snow and hot blondes will always follow the path of “I will expend 140% of whatever i get… come at me!, bro”

    Give chavistas 1000 bucks a barrel, they’ll manage to use it all and owe extra 500 at fuckton percent interest and ZZZ—– credit score.

  4. Give Cavistas power and they believe they can control the laws of physics and the laws of economics. Of course, they don’t understand those laws anyway. So, when things go bad, it’s not their fault. It must be the opposition or America’s influence. It’s a deadly embrace of ignorance. At some point, somebody with sanity must take over the asylum.

  5. These estimations use the deficit of the central goverment budget as opposed to the really relevant deficit of the public sector. Offbudget expenditures are huge. If you get PDVSA and CVG, among others, out of the picture you do not get a good sesnse of the real deficit. BTW I am at the IMF meeting in DC and most people here, fund managers, analysts, use de $200 figure and it comes from their own calculations, Hausmann included. So I am glad to say it is not just my estimate.

  6. Según Capriles tenemos que disminuir la producción petrolera porque contamina mucho. Es en serio. Lo dijo. Lo juro. No es paja. De pana de pana. Es en serio que Capriles dijo que no tenemos que producir petróleo porque contamina demasiado

    • Is it me, or is Capriles becoming an even emptier shell than most of the governments buffoons.
      Seriously, his comments are continuously loosing base every time he speaks.
      I may be one of the few people I know with an actual ecological conscience and one of many who wish to see petroleum on the energy back burner (mostly at this governments expense) but you’ve gotta be realistic.
      Reality= Venezuela + no gas= SCREWED!!!!!!!

  7. So, who is willing to guess at when the reserves will be completely gone? Sometime early next year, I am guessing, but has anyone done the math? Will we know when they sell off the remaining gold?

  8. That graph explains perfectly why, among many other things, Ramírez is trying to get the other OPEC countries to sell less and raise prices.

    Also, the llist of OPEC countries proves that being an oil exporter is a curse on most countries.

  9. This is the estimated break even for government budgets in 2014 Government budgets are often set far below what the actual price is expected to be, so the executive branch has extra income to play with beyond what is budgeted via the parliament/national assembly. In Venezuela, both the IV and Vth Republics have regularly done this.

    I would not put much stock in these numbers. It is notoriously difficult to see what price of oil is needed by an oil-producing state with a national oil company. The burden can be shifted beyond the state company to the state itself and onto the population – both businesses and citizens- in many ways. And, adjustments in spending by the company can be made There is no sharp price line as to where a crisis begins.

    I can’t express in words how much time was wasted over a decade by analysts trying to predict (on behalf of diplomats and business clients, or the public) at what price would rojo-rojito PDVSA would “fail.”

    However, one can certainly say that lower prices will bring proportionately more grief for esp. PDVSA. And, the battle between ‘high absorbers’ (price hawks) and ‘low (rent) absorbers’ (price doves” is again on within OPEC.


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