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The collapse of oil production in Venezuela will accelerate after a massive power outage




The blackout that collapsed in Venezuela caused destruction that would accelerate the collapse of its oil production while dealing with an American embargo that would cause its main market loss, analysts estimate.

The horizon was already bleak ahead of the March 7 massive power cuts, with the freefall pumping and the PDVSA oil company defaulted and driven out of the financial markets by US sanctions. The emergency began to be resolved on Monday.

The International Energy Agency (IEA) warned on Friday in Paris that the loss of barrels due to blackout may affect the supply of the market, so it will be necessary to go to the complementary capabilities of Saudi Arabia.

In addition, since April 28, US citizens and companies have been barred from negotiating Venezuela's crude oil, which accounts for 96 percent of the country's revenue with the largest gold reserves.

Although these sales are in clear decline, it will hit Washington's strategy to strangle the economic of the socialist government of Nicholas Maduro, since they represent 75% of PDVSA's cash flow.

Shipments to the United States fell from 1.3 million barrels per day in January 2011 to only 100,000 in the first half of March, according to the energy agency of that country.

Maduro argues that the sanctions of the White House, which he broke diplomatic relations in January, cost Venezuela about $ 30 million US.

The last paralysis hit hard in the weakened industry. "Not a barrel came out on the days of power failure (…) This situation is only the beginning of a major deterioration cycle," said oil expert Luis Olivier AFP.

Venezuela's crude production fell again last February, to just over 1 million barrels a day, 142,000 less than the January average, according to OPEC's secondary sources.

A decade ago it was 3.2 million barrels a day.

After blackout, this volume could fall to 500,000 barrels per day, warned economist Asdrúbal Oliveros, adviser of Ecoanalítica Consulting, citing a report by Barclays, a financial services firm in London.

PDVSA did not present a balance of the impact of the electric failure, during which it just announced that it was in the internal supply of gasoline when long lines were established at service stations. "We have not stopped the activity, nor will they stop!" he promised.

Three tanks PDVSA in Anzoategui state (northeast) was caught on Thursday, which the government condemned as a "terrorist action" by the United States in his offensive to get him out of control.

Wells collapsing

The IEA noted that "although there are signs that the situation is improving, the degradation of the electrical system is such that" it can not guarantee that "repairs are sustainable."

"In some cases the damage to the wells is irreversible, and in other cases it is necessary to make a very strong investment to return them to action," says Louis Olivross.

The number of active wells was sharply declining, amid claims of lack of investment in exploration and maintenance, and in severe cases of corruption.

According to oil service provider Baker Hughes, 26 platforms operated in the country in late February, compared to 47 active a year ago. In February 2014 there were 74.

Maduro condemns that the massive electric failure was due to "cyber attacks" in Washington against the hydroelectric power plant of Gori (State of Bolivar, South), which produces 80% of the country's energy.

Some experts reject this version and think that breaks – as usual in the last decade – will continue to affect all economic sectors.


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