The only thing saving Chavez from himself is steadily rising oil prices; if they reverse, it's a good bet that the Venezuelan government will fall, doing serious damage to the resurgant left-wing populist strain of Latin American politics. I'm told that PDVSA used to be known as the only state-run oil company that was competitive with the majors in terms of expertise and efficiency; now it is rapidly descending past other state-run firms in terms of competence. Since Venezuela's oil is unusually heavy, sulphurous, and difficult to extract, that decline will be a disaster for Venezuela's poor, who may be enjoying those marble elevators without electricity to run them if oil falls back towards $25 a barrel. This is not some grim gloating of a classically liberal economics writer at having been proven right. If PDVSA screws up the Venezuelan oil supply, consumers around the world will suffer, the poorest worst--and the poorest Venezuelans worst of all.In other words: "If oil prices collapse, oil prices will skyrocket".
(p.s. This post should in no way be construed as supportive of Hugo Chavez' destined-to-fail leftist policies.)
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