Venezuela’s state-owned oil company has been struggling to pay its debt to suppliers.
The problem has gotten worse with the loss of qualified labor, lack of investment and U.S. sanctions.
As CGTN’s Juan Carlos Lamas reports the company is feeling the pain in more ways than one.
For forty-year-old Jairo Marcano, PDVSA was once a symbol of pride. Not anymore.
He achieved his dream of joining Venezuela’s state-run oil company, spending four years as a ship captain…
But he says low wages and poor working conditions forced him to leave PDVSA, and return to the fishing industry.
“I have colleagues who work at PDVSA and want to be in my position as a fisherman, since profits are way better, but they need to learn how to fish first. I’m thankful I knew how to do it, even before entering PDVSA,” said Jairo Marcano, a former PDVSA Ship Captain.
Venezuela relies overwhelmingly on its oil sales, with 90% of government revenue generated by oil sales. But in recent years production has dropped dramatically,
According to the Organization of Petroleum Exporting Countries, PDVSA went from producing nearly three million barrels per day in 2000 to just 768,000 in April of this year.
That’s a 73 percent decrease in less than two decades and the biggest decline of any OPEC member state.
And while Venezuela’s oil company has been hit by recent U.S. sanctions, experts agree PDVSA was already struggling.
“Due to the expropriation of companies which provided services from pipelines to transport to PDVSA, the oil production itself was affected, but years ago the government had money and used it to import what was needed, and that worked until there was no more money. Today the government is cashless,” said Antonio Alvarado an oil consultant.
PDVSA says it reduced its financial debt by five percent last year, but still owes some $34 billion.
President Nicolas Maduro says those sanctions amount to a financial and commercial naval blockade preventing his government from making international payments, as well as stopping all vessels with imported supplies from reaching Venezuelan ports.
Critics of Maduro argue his mismanagement of the economy has driven the decline, with little sign the nation’s oil sector and PDVSA’s fortunes will improve anytime soon