Economics &
Finance
Gold and oil slump batters
Venezuelan reserves
The global financial crisis is undermining oil and gold
prices, and Venezuela depends on these two columns to sustain rising imports at
their highest peak in over 16 years. Gold bullion accounts for 73% of
international reserves and are part of the foreign currency pool available for
the Central Bank (BCV) to meet demands for foreign currency at the official
exchange rate. The pool, however, is running out. Last May, gold prices
averaged U$D 1,585 per troy ounce, a 9% drop from U$D 1,743 in February and the
lowest since July 2011. (El Universal,
06-04-2012; http://www.eluniversal.com/economia/120604/gold-and-oil-slump-batters-venezuelan-reserves)
Currency allocations to the private
sector up 4.67%
According to figures from the Currency Board (CADIVI) and
the Foreign Currency Transaction System (SITME), approvals for private sector
foreign currency transactions rose 4.67% to U$D 9.2 billion during the first
quarter of 2012. Although CADIVI approvals dropped 3% against 1Q 2011, SITME
transactions through the Central Bank rose 35%. More in Spanish: (El Nacional,
06-05-2012; http://www.el-nacional.com/)
Speculation on possible Chavez
departure spurs markets
According to New York broker Auerback Grayson the price of sovereign
debt has taken off and the Caracas Stock Exchange has doubled its value, making
it the best performing exchange in the world. The JP Morgan index shows
Venezuelan dollar bonds up 9.5% since December, which is twice the JP Morgan
3.67% average for emerging market bonds. More in Spanish: (El Nacional06-05-2012;
http://www.el-nacional.com/)
Commodities
OPEC oil down 3.58% to U$D 97.44,
SHELL predicts prices will trend down this year
The price of a barrel of crude oil from the Organization
of Petroleum Exporting Countries (OPEC) dropped U$D 3.62 (3.58%) from U$D
101.06 to U$D 97.44, which is the first time this year it has been under U$D
100 per barrel.... and Peter Voser, Executive President of Royal Dutch Shell
prices will continue down this year due to lower demand, but will pull back in
2012. More in Spanish: (AVN, 06-05-2012; http://www.avn.info.ve/contenido/precio-cesta-opep-bajó-358-y-se-ubicó-9744-dólares-barril,
El Mundo,
Guyana confirms oil exploration in maritime
areas claimed by Venezuela
The Guyanese government has confirmed that it is planning
on a "2D seismic data acquisition"
in Exxon Mobil's Stabroek concession, which is located in the Orinoco Delta
maritime area within an area claimed by Venezuela. More in Spanish: (El Universal,
06-05-2012; http://www.eluniversal.com/nacional-y-politica/120605/guyana-confirma-estudios-en-bloque-que-protesto-venezuela)
SIDOR steel production down to 2010
levels at 1.8 million tons
Statistics from SIDOR reflect a dramatic downturn in operations and
results, and rule out any possibility of reaching the 3.5 ton liquid steel ton
goal set for the close of this year. Monthly production ranging between 133,000
and 188,000 tons add up to a total year's production of no more than 1.8
million tons. More in Spanish: (El Mundo, 06-05-2012; http://www.elmundo.com.ve/noticias/economia/politicas-publicas/produccion-de-sidor-retrocede-a-niveles-de-2010-co.aspx)
International Trade
Turkey Preparing Housing-for-Oil
Deal With Venezuela, Vatan Says
Turkey is negotiating to build low- cost housing in Venezuela in
exchange for oil, Vatan newspaper said citing Bulent Gedikli, chief of economic
affairs for the ruling Justice and Development Party. Venezuela may pay 650
barrels of oil for every 100 square meters of housing built, the Istanbul-based
paper cited Gedikli as saying. Venezuelan President Hugo Chavez has said the
country needs to build around 2 million homes, Vatan said. (Bloomberg,
06-04-2012; http://www.bloomberg.com/news/2012-06-04/turkey-preparing-housing-for-oil-deal-with-venezuela-vatan-says.html)
Logistics and Transport
Unplanned imports clog local ports,
food reported stored in military installations
The increase in imports is reflected in port activity. At Puerto Cabello
the amount of cargo is such that efforts to speed up offloading and processing
are insufficient. Last Friday 29 ships were at port - 14 of them bearing bulk
foodstuff - and Carabobo State Fedecámaras business federation Chairman Antonio
Landaeta says "this shows we are
producing nothing and imports are unplanned". Local sources in Puerto
Cabello say that a significant number of vans - an overflow from the state
owned storage companies - have been stored in the Central Region's Division for
Storing and Controlling Chemicals and Explosives. More in Spanish: (El
Universal, 06-05-2012; http://www.eluniversal.com/economia/120605/importaciones-no-planificadas-congestionan-los-puertos-locales,
El Carabobeño; http://www.el-carabobeno.com/impreso/articulo/19563/gobierno-almacenara-carga-alimenticia-en-instalaciones-militares-del-puerto)
Politics
ABC: Chávez takes an opiate stronger
than morphine
President Hugo Chávez withstands the pain out of his
cancer extended to his bones with an opiate "one hundred-fold stronger than morphine," Spanish daily
newspaper ABC reported on Sunday. The article signed by ABC correspondent in
Washington Emili J. Blasco claims that Chávez "is taking fentanyl to ease the heavy pain caused by the persistent
progression of bone cancer." (El Universal, 06-04-2012; http://www.eluniversal.com/nacional-y-politica/120604/abc-chavez-takes-an-opiate-stronger-than-morphine;
Bloomberg, 06-02-2012; http://www.bloomberg.com/news/2012-06-02/cancer-stricken-chavez-makes-brief-public-appearance-in-caracas.html;
CNN, 06-03-2012; http://edition.cnn.com/2012/06/03/world/americas/venezuela-chavez-health/index.html?iref=allsearch)
President calls for making the
"revolution irreversible" in the October 7 elections, in a telephone call to the
state television station. More in Spanish: (El Universal, 06-05-2012; http://www.eluniversal.com/nacional-y-politica/120605/presidente-exige-hacer-irreversible-a-la-revolucion)
Santos thanks Chávez for nabbing
drug lord
Colombian President Juan Manuel Santos has thanked
President Chávez, for capturing Diego Pérez, a Colombian citizen accused of
leading a paramilitary gang, on Venezuelan soil. Santos said Chavez told him
the criminal would be sent back to Colombia in the coming days. More in
Spanish: (El Universal, 06-05-2012; http://www.eluniversal.com/nacional-y-politica/120605/santos-agradece-a-chavez-captura-de-narcotraficante)
155.788 murders reported in
Venezuela since 1999
The war in Iraq war has 162.000 dead since 2003;
Venezuela reported 76% casualties in the same period. Despite having announced
at least 20 security plans in this period, homicides increased 223% over the
past 14 years. Fermín Mármol García, a specialist in crime prevention, warns
that it is not enough to position the military at certain points. More in
Spanish: (El Universal, 06-03-2012; http://www.eluniversal.com/nacional-y-politica/120603/155788-asesinatos-desde-1999-se-han-registrado-en-venezuela)
Venezuela, oil and Chavismo without
Chavez: column
Hugo Chavez's picture is everywhere in Venezuela and may
remain ubiquitous for some time, despite the president's serious illness. But
soon the image may only be a Mao-like symbol of regime continuity. Chavismo,
Hugo Chavez's unique and malleable blend of militarism, historical revisionism,
command economics, and knee-jerk anti-Americanism, is a movement intimately
tied to the leader and his almost messianic bond with Venezuela's poor.
But Chavez's cancer, which, by all accounts seems to have taken a turn
for the worse, poses a dilemma for the movement. Column by Reuters market
analyst Robert Campbell. (Reuters, 06-04-2012; http://uk.reuters.com/article/2012/06/04/column-oil-idUKL1E8H428G20120604)
The following brief is a synthesis of the news as reported by a variety of media sources. As such, the views and opinions expressed do not necessarily reflect those of Duarte Vivas & Asociados and The Selinger Group.
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