The Devil's Excrement

Two articles today in El Nacional (page A 20, by subscription only) and El Universal page 1-22 on international reports on PDVSA and the country’s difficulties with oil production.

The one in El Universal focuses on the report by the EIA (Energy Information Administration) which says that PDVSA’s exports are down by 25% so far this year in dollar terms.

The one in El Nacional has some interesting numbers and is base on reports by the IDB (International Development Bank) and CAF (Andean Corporation for Development). CAF projects that if the company does not invest US$ 4 to 5 billion to recover production, it will have a cash flow shortage that will be up to US$ 11 billion by 2008, this assuming the Government stops drawing dividends from the company which is unlikely to happen. According to an unidentified source at CAF, the only recourse the Government may have is increase the price of gasoline, a highly unpopular move (The price of gas in Venezuela is currently 15 US$ cents a gallon at the parallel market exchange rate.

The IDB report concludes that PDVSA’s own oil production has gone down by 1.2 million of barrels of oil per day since 1999. Total oil production is two hundred thousand barrels of oil less than in 1990 and PDVSA has compensated the drop partially with the operational agreements of the oil opening (much criticized by Chavez) which add half a million barrels per day and the strategic associations of the Orinoco heavy oil belt which contribute 450,000 barrels of oil a day.

These numbers are very scary to me; the only way that the standard of living of people can improve is for there to be economic growth. The private sector is doing terrible and it sounds like PDVSA will do worse going forward. This makes it impossible to expect any improvement in the standard of living unless this course is reversed. Even scarier would be if the price of oil were to fall….

Two articles today in El Nacional (page A 20, by subscription only) and El Universal page 1-22 on international reports on PDVSA and the country’s difficulties with oil production.

The one in El Universal focuses on the report by the EIA (Energy Information Administration) which says that PDVSA’s exports are down by 25% so far this year in dollar terms.

The one in El Nacional has some interesting numbers and is base on reports by the IDB (International Development Bank) and CAF (Andean Corporation for Development). CAF projects that if the company does not invest US$ 4 to 5 billion to recover production, it will have a cash flow shortage that will be up to US$ 11 billion by 2008, this assuming the Government stops drawing dividends from the company which is unlikely to happen. According to an unidentified source at CAF, the only recourse the Government may have is increase the price of gasoline, a highly unpopular move (The price of gas in Venezuela is currently 15 US$ cents a gallon at the parallel market exchange rate.

The IDB report concludes that PDVSA’s own oil production has gone down by 1.2 million of barrels of oil per day since 1999. Total oil production is two hundred thousand barrels of oil less than in 1990 and PDVSA has compensated the drop partially with the operational agreements of the oil opening (much criticized by Chavez) which add half a million barrels per day and the strategic associations of the Orinoco heavy oil belt which contribute 450,000 barrels of oil a day.

These numbers are very scary to me; the only way that the standard of living of people can improve is for there to be economic growth. The private sector is doing terrible and it sounds like PDVSA will do worse going forward. This makes it impossible to expect any improvement in the standard of living unless this course is reversed. Even scarier would be if the price of oil were to fall….

Good article by Juan Raffalli in page 1-17 of El Universal entitled “Falsehoods about the recall referendum”. Some highlights:

–It’s necessary to consider first the requests for recall referenda for regional officials. False. The same regulation that establishes that requests have to be handled in the order in which they are received  states that in the interest of public interest priority may be given to requests that were introduced later. It is obvious that the presidential recall referendum has the highest national interest and it was thus established in the international agreement signed on May 29^th. by both the Government and the opposition.

–Before the recall referendum the national Electoral Commission has to be restructured in the next six months (Chávez dixit). False. The Organic Law of electoral power establishes among its transient articles that the Electoral Board has to adjust itself to the law within six months, but that period is a maximum temporal reference. But nowhere in that law is it established that there can be no electoral events simultaneously. If that were the case, the right to vote would be suspended, which is not possible even in the case of states of exception.

–Special regulations are required for the recall referendum: In any case, it would be regulations for the internal functioning (of the CNE). The Constitution expressly states that no fundamental right, which includes the right to vote, can be limited or suspended due to the lack of regulations. The agreement last May 29^th.  and prior decisions by the Supreme Court give full validity to the Suffrage Law which has articles about recall referenda which are perfectly applicable to the one in question.

–The signatures are fraudulent: It has been said that due to non-essential formalisms one can not sacrifice the right to express or petition, which would attempt against articles 5 and 62 of the Constitution. Moreover, what other requirement could be asked of those that sign the petition. Their blood group, their license plate? Only the people are entitled to initiate calling for a recall referendum according to Article 72 of the Constitution, which is explicitly mentioned in the petition. Could it be that more than two million people have to go to a public notary to certify their signatures? And how were the signatures verified to register in front of the CNE, Chavez’ MVR or to register hundreds of candidates to the Constituent Assembly? In any case, the best thing is that in the end if we were to have to collect the signatures anew, that event will be in itself an anticipated recall act so that for that one that may be recalled the remedy might be worse than the illness.

Good article by Juan Raffalli in page 1-17 of El Universal entitled “Falsehoods about the recall referendum”. Some highlights:

–It’s necessary to consider first the requests for recall referenda for regional officials. False. The same regulation that establishes that requests have to be handled in the order in which they are received  states that in the interest of public interest priority may be given to requests that were introduced later. It is obvious that the presidential recall referendum has the highest national interest and it was thus established in the international agreement signed on May 29^th. by both the Government and the opposition.

–Before the recall referendum the national Electoral Commission has to be restructured in the next six months (Chávez dixit). False. The Organic Law of electoral power establishes among its transient articles that the Electoral Board has to adjust itself to the law within six months, but that period is a maximum temporal reference. But nowhere in that law is it established that there can be no electoral events simultaneously. If that were the case, the right to vote would be suspended, which is not possible even in the case of states of exception.

–Special regulations are required for the recall referendum: In any case, it would be regulations for the internal functioning (of the CNE). The Constitution expressly states that no fundamental right, which includes the right to vote, can be limited or suspended due to the lack of regulations. The agreement last May 29^th.  and prior decisions by the Supreme Court give full validity to the Suffrage Law which has articles about recall referenda which are perfectly applicable to the one in question.

–The signatures are fraudulent: It has been said that due to non-essential formalisms one can not sacrifice the right to express or petition, which would attempt against articles 5 and 62 of the Constitution. Moreover, what other requirement could be asked of those that sign the petition. Their blood group, their license plate? Only the people are entitled to initiate calling for a recall referendum according to Article 72 of the Constitution, which is explicitly mentioned in the petition. Could it be that more than two million people have to go to a public notary to certify their signatures? And how were the signatures verified to register in front of the CNE, Chavez’ MVR or to register hundreds of candidates to the Constituent Assembly? In any case, the best thing is that in the end if we were to have to collect the signatures anew, that event will be in itself an anticipated recall act so that for that one that may be recalled the remedy might be worse than the illness.