Archive for July 30th, 2007

A picture is worth 10,000 words# 33: Central Bank’s study of the population

July 30, 2007

This is a puzzling graph which appeared in El Universal a couple of days ago and I don’t quite know what to make of it, it is the Central Bank’s (BCV) study of Venezuelan homes:

1) It says Venezuela was mostly a middle class country in 1997 and has remained the same since.
2) There has been little change since 1997. Only 1.1% of the poorest families moved from strata V tto IV.the biggest change is in the increases in the seond strata, which is fully middle class
3) Given the change in the price of oil between 1997 and 2005, you would think even spending the money inefficiently would have a larger effect.
4) It disagrees with data from the INE, the national Institute of Statistics and the data from Universidad Catolica.

What gives?

A picture is worth 10,000 words# 32: Estimating Venezuela’s gas consumption

July 30, 2007

PDVSA’s black box does not tell us what is the national consumption of gasoline and diesel of the vehicles in the country. Recently a presentation by PDVSA’s former economist Ramon Espinasa, put the number at 770,000 barrels per day. In this post we estimate the number using the growth in vehicle sales in the last few years and compare it to Espinasa’s

In the figure above (which has a shift in the x-axis (My Mac died, using Windows!), that is, the first point corresponds to 2001, the last one to June 2007), we plot the total number of vehicles in the country, using the sales reported by Cavenez and adding them to the number of vehicles estimated to exist in the country in December 2000, subtracting a small attrition rate per year.

In the graph below, we assume gasoline and diesel consumption increases proportionally to the number of vehicles. Then, we use the total number of barrels of gasoline and diesel sold by PDVSA’s Deltaven in 2000, which represented 51% of the country’s sales, according to PDVSA’s 2000 SEC report and extrapolate year by year to obtain the graph below.

The number I come up with is 750,000 barrels per day, which is quite and similar to Espinasa’s number. In fact, given that the price of gas has not changed since 2000 in local currency and that the currency has depreciated officially by roughly 200% and unofficially by 500%, then it would seem logical to believe that people are using more gas than ever or that more is being smuggled to Colombia due to the price differential.

Thus, if you take Espinasa’s production (or IEA’s or OPEC’s) this type of number, you get that Venezuela’s exports can be no more than 1.63 million barrels of oil a day.