Venezuela struggles with plunging oil prices

Global Business

Venezuela struggles with plunging oil prices

Global oil prices are hitting six year lows. The international benchmark called Brent oil ended Tuesday trading at under $45 a barrel.

That is good news for oil importers, but not for exporters. One country that is feeling the pinch is Venezuela. CCTV’s Stephen Gibbs filed this report from Caracas.

Venezuela struggles with plunging oil prices

Venezuela struggles with plunging oil prices

Global oil prices are hitting six year lows. The international benchmark called Brent oil ended Tuesday trading at under $45 a barrel. That is good news for oil importers, but not for exporters. One country that is feeling the pinch is Venezuela. CCTV's Stephen Gibbs filed this report from Caracas.

More details:

  • 97 percent of Venezuela’s foreign income depends on oil. For much of the last two decades, the leftist Venezuelan government has enjoyed sky-high oil prices. With the price falling, the government is short of hard currency, and has already drastically cut imports that led to shortages of many basics.
  • But a default for Venezuela could be hugely expensive. Many of Venezuela’s assets are overseas, and could be relatively easily seized by creditors. The consensus among economists is that unless there is a dramatic rise in the price of oil, the year 2016 is going to be extremely difficult for Venezuela.