Venezuela: the decline of an oil giant in crisis

Leaks, rusted pipes, pieces of broken equipment scattered about and staircases leading nowhere: Lake Maracaibo’s oil field is a metaphor for Venezuela’s once-flourishing petroleum industry that is now on its knees.

More than a century ago, the Maracaibo basin in northwestern Zulia state was the birthplace of a business that transformed the country into one of the world’s 10 largest oil producers and a Latin American economic heavyweight.

By 2008, the country was producing 3.2 million barrels of oil a day.

Just 13 years later, it can only muster 500,000 to one million barrels per day amid a grinding economic crisis marked by years of recession and hyperinflation. Venezuela’s gross domestic product per capita is now similar to that of Haiti.

Despite sitting on the world’s largest proven oil reserves, the country battles fuel shortages and frequent blackouts, and at one point even had to import fuel from Iran.

The Maracaibo basin was once a flurry of oil activity, with a halo of light over the complex visible at night from a fair distance.

ET Energy World
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