Latin America Advisor
Energy Advisor
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Will Venezuela Be Able to Meet its 2023 Oil Output Target?
Venezuela is planning on oil to finance 63 percent of its budget for 2023, an increase from this year amid the United States’ easing of sanctions on Venezuelan state-owned oil company PDVSA. // File Photo: Venezuelan Government.
Venezuela is planning on oil to finance 63 percent of its budget for 2023, a figure slightly higher than this year’s, Reuters reported Dec. 5. The stronger reliance on oil comes as the U.S. government reviews its sanctions on the South American country’s state-owned oil company, PDVSA, first imposed in 2019. The easing of sanctions would allow exports to the United States, boosting oil sales. Revenues from PDVSA are expected to bring in $9.34 billion to the government’s budget, up from this year’s $8.2 billion contribution. How likely is Venezuela to meet its oil revenue goal? How will the country’s national budget be affected if the figure is not met, and which sectors will be most affected?
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Michael C. Lynch, president of Strategic Energy & Economic Research and distinguished fellow at EPRINC: “The recent moves by the U.S. government to allow Chevron to resume some operations in Venezuela are small steps toward a revival of that nation’s oil industry, but not necessarily a lasting one. The Biden administration has allowed the company to resume sales for six months, contingent on negotiations between the Maduro regime and the opposition. Many fear that the talks will prove inconclusive and the export agreement will not be renewed, but at least in the meantime, the company seems likely to undertake needed maintenance that will allow for increased production in the future. Unfortunately, this is a bandage on the disaster that is the Venezuelan economy and oil industry. While estimates that tens of billions of dollars in maintenance and repair are needed to restore production to…”
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A sister publication of the Inter-American Dialogue’s daily Latin America Advisor, the weekly Energy Advisor captures fresh analysis from business leaders and government officials on the most important developments in oil and gas, biofuels, the power sector, renewables, new technologies, and the policy debates shaping the future of energy in the Western Hemisphere and beyond. To subscribe or for more information, contact Erik Brand, publisher of the Advisor, at ebrand@thedialogue.org.
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