Venezuela has provided about 11% of U.S. oil imports, roughly 1.2 mb/d.   Two trends are putting that supply at risk.  The first is Venezuela’s increased commitment to sell its oil to Cuba, to China, and to other non-Japanese Asian countries.  This commitment may be partially one of political comradeship, but it also is based on Venezuelan debt to certain Asian countries. The second is the decline in Venezuelan production that has come from the increasing financial chaos and expropriation activities caused by its virtual dictator, Huge Chavez.  I think …

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Ever since oil lifted over $50 I’ve been saying that speculation is the cause.   Actually, the lower dollar (caused by speculation) is a good part of the cause and inflation speculation is the rest.   What is not driving oil up, it seems, is actual supply and demand.  That’s the assumption in the market, anyway, and it’s probably correct. But there are some fundamentals influencing oil to the upside that are worth noting.   One is Nigeria and the other is Venezuela.   Both have collapsing governments and economies that have been well …

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Oil prices are ascending in concert with a rising stock market and an expanding sense of non-pessimism about the global economy, yet the supply of cheap oil remains far greater than demand.   Huge amounts of $5 cost oil is being moth-balled by OPEC and there is no shortage of oil inventory above ground, much of it floating at sea.   So the fundamentals of near term oil supply and demand imply lower prices but they are being overpowered by speculators who want to own oil as an investment category.  There …

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Just as we see Russia combining military and energy deals in Venezuela and Cuba, China is doing the same thing with both Venezuela and Brazil, as the following report details.  China has increased its importation of oil from Brazil, is cementing agreements to further that trend, and is doing military and oil deals with Venezuela as well.    With both Russia and China combining military and energy policy for national security purposes,  Americans must ask what its government is doing to secure its energy future in the face of …

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As the following report by Platt’s describes in more detail, Russia is moving to control oil assets in Venezuela and Cuba. This move coincides with Russian military alliances with Venezuela and with Russia’s new sense of wealth and entitlement that seems to be pushing Russian diplomacy toward aggressive confrontations with the west.  Russia’s swift military reaction to Georgian aggression in the vicinity of an important oil pipeline that feeds Europe is part of the same picture.  Russia, already the world’s largest oil exporter, seems clearly determined to aggregate increasing …

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Hugo Chavez would like nothing more than to sell all his oil to some customer other than the U.S.  That way he both gets his revenue and hurts his energy.  He seems to have found his customer - China.  As the report below describes, Venezuela, which has ramped up its China oil sales to 250 kb/d so far, is planning on 500 kb/d in 2009 and 1 mb/d by 2012.  Since the Venezuela currently is the fourth largest supplier to the U.S. at 1.1 mb/d and since exports …

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The Oil & Gas Journal (5/5/08) published an analysis of the Iranian oil industry that begins: “The Iranian oil and gas industry approaches its 100th anniversary bloated, corrupt, and nearly bankrupt, managing four times the employees but two thirds of the oil production it had before the Islamic Revolution of 1978-79.”

The piece provides details supporting each of those allegations and it outlines the history of the industry, starting with the discovery of oil in 1908 by a predecessor company of BP.  Oil was nationalized in 1951 with a very successful …

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"Never again will they rob us — the Exxon Mobil bandits. They are imperial, American bandits, white-collared thieves. They turn governments corrupt, they oust governments. They supported the invasion of Iraq," he said. Thus reported Reuters.  This episode is the third recent defeat for Chavez.  Previously his attempt to become dictator for life was voted down and more recently members of his own party have begun to voice opposition to him.   His problems all stem from the dismal performance of the Venezuelan economy under his mis-management. Chavez’ action …

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  According to the Ministry of Energy and Petroleum, oil production in the Orinoco belt is to double in 2012 (File Photo) The domestic oil production figures are increasingly lower than the target set in state-run oil holding Pdvsa’s Oil Sowing Plan MARIANNA PÁRRAGA EL UNIVERSAL The Oil Sowing Plan -the Venezuelan state-owned oil giant Pdvsa’s business plan up to 2012- made no significant progress in 2007. Excluding the completion …

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How long can the country’s economy grow while it’s oil sector declines without having a serious negative impact on the amount of oil available to export?  Here’s the story from Reuters:
Venezuela economy grew 8.4 pct in 2007-central bank
CARACAS, Dec 30 (Reuters) - Venezuela’s economy expanded 8.4 percent in 2007 despite a contraction in the oil sector, the backbone of the South American nation’s economy, the central bank said on Sunday.

The bank said the oil sector had shrunk 5.3 percent in the year, but 9.7 percent growth in non-oil parts of …

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History and analysis of Venezuela’s energy production and use.  Discusses impacts of Chavez takeover of PvDSA and forced withdrawal of western IOC’s Click here.

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OPEC is working with Venezuela to try to reconcile their reported production with independent analyses indicating actual may be significantly lower.  Click here.

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Mexico, Venezuela, Kuwait, Iran, Russia and Indonesia.   click here.

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