Oil & Energy
Venezuela's weekly oil basket price continued to rise for the eighth straight week -- but only a few cents as oil prices began to moderate in some well-supplied markets. According to figures released by the Ministry of Energy and Petroleum, the average price of Venezuelan crude sold by Petroleos de Venezuela S.A. (PDVSA) during the week ending May 15 was US$ 57.00, up just 26 cents from the previous week's US$ 56.74. (Latin American Herald Tribune, http://www.laht.com/article.asp?ArticleId=2387900&CategoryId=10717)
PDVSA to pay interest on bonds maturing in 2021, 2024, and 2035State-run oil company Petróleos de Venezuela (PDVSA) will pay the corresponding interests of the six-month period ending in May 2015 to all holders of bonds maturing in 2021, 2024, and 2035.
The operation will be made pursuant to the terms and conditions of those papers, which were issued in November 2011, May 2012, and May 2014, respectively, PDVSA said in a press release. (El Universal, http://www.eluniversal.com/economia/150518/pdvsa-to-pay-interests-of-bonds-maturing-in-2021-2024-and-2035
Falling oil prices try exportersThe drop of international oil prices will have a significant fiscal effect on the economies of Latin American countries and the Caribbean and will put them to the test with regard to their ability to make adjustments.
In the case of Venezuela, its reluctance to up-regulate gasoline prices could translate in pressure on the countries which import Venezuelan oil through PETROCARIBE. This is according to information posted on the website of the International Monetary Fund (IMF). It is also noted that in many of these countries, the decreasing value of oil imports exceeds the projected financing from PETROCARIBE. (El Universal, http://www.eluniversal.com/economia/150518/falling-oil-prices-try-exporters)
FORD, government to set out rules for car sales in dollarsRepresentatives of FORD Motors de Venezuela and Venezuelan officials are meeting to plan for automotive assembling in July-August this year, and later, as well as car sales in dollars, says Gilberto Troya, the Secretary General of Ford trade union. He adds that customers will be invoiced in dollars at the FOREX rate traded at the Foreign Exchange Marginal System (SIMADI) (VEB 197.89 per USD), while production costs will be set according to the Ancillary Foreign Currency Administration System (SICAD) rate (currently VEB 12 per USD). Previously Industries Minister Ricardo Menéndez had said that the only legal currency in Venezuela is the bolívar, in response to announcements that the company would begin selling vehicles in dollars after reaching an agreement with the national (El Universal, http://www.eluniversal.com/economia/150518/ford-venezuela-govt-to-set-out-rules-for-car-sales-in-dollars; Veneconomy, http://www.veneconomy.com/site/index.asp?ids=44&idt=43916&idc=2)
FEDECÁMARAS asks government not to take over distribution centersFEDECÁMARAS President Jorge Roig warns that taking over private product distribution centers "would be the worst mistake" the government could make. He added that it obstacles to acquiring FOREX continue the private sector could "collapse", bringing down domestic production and imports. More in Spanish: (El Mundo, http://www.elmundo.com.ve/noticias/economia/empresas/fedecamaras-insta-al-gobierno-a-no-tomar-centros-d.aspx#ixzz3aTqopbbn; Ultimas Noticias, http://www.ultimasnoticias.com.ve/noticias/actualidad/economia/fedecamaras-insta-al-gobierno-a-no-tomar-centros-d.aspx)
The worst is yet to come
POLAR complains of constant inspections
Economy & Finance
Key government legislator admits FOREX scarcityThe pro government Chairman of the National Assembly’s Finance and Economic Development Committee Ricardo Sanguino says “there is not enough availability of foreign currency to continue satisfying the country’s needs.” He explained priorities had to be set to boost productive and economic activities. (Veneconomy, http://www.veneconomy.com/site/index.asp?ids=44&idt=43917&idc=2)
Russia OK's extending Venezuela credit through 2016
Russia and Venezuela signed the agreement for a US$ 4 billion credit in December 2011, in order to finance the delivery of Russian industrial products. More in Spanish: Últimas Noticias, http://www.ultimasnoticias.com.ve/noticias/actualidad/economia/rusia-aprueba-la-ampliacion-del-prestamo-a-venezue.aspx#ixzz3aZQI8582)
Politics and International Affairs
The Wall Street Journal reports Venezuelan officials suspected of turning country into cocaine hubThe Wall Street Journal reports U.S. prosecutors are investigating several high-ranking Venezuelan officials, including the president of the country’s congress, on suspicion that they have turned the country into a global hub for cocaine trafficking and money laundering, according to more than a dozen people familiar with the probes. An elite unit of the Drug Enforcement Administration in Washington and federal prosecutors in New York and Miami are building cases using evidence provided by former cocaine traffickers, informants who were once close to top Venezuelan officials and defectors from the Venezuelan military, these people say. A leading target, according to a Justice Department official and other American authorities, is National Assembly President Diosdado Cabello, a former army lieutenant, considered the country’s second most-powerful man. “There is extensive evidence to justify that he is one of the heads, if not the head, of the cartel,” said the Justice Department official, speaking of a group of military officers and top officials suspected of being involved in the drug trade. “He certainly is a main target.” Investigations are being run by federal prosecutors who have wide leeway to target criminal suspects. U.S. authorities say they are far along in their investigations. But they say any indictments that may result might be sealed, making them secret until authorities can make arrests—something that would be difficult if not impossible unless the suspects travel abroad. U.S. law-enforcement officials say many Colombian traffickers moved operations to neighboring Venezuela, where they found a government and military eager to permit and ultimately control cocaine smuggling through the country. “It is a criminal organization,” said the Justice Department official, referring to certain members of the upper echelons of the Venezuelan government and military. At the same time, a group of 16 Democrats in the US House of Representatives are asking President Barack Obama to lift sanctions on Venezuelan officials implicated in human rights violations and drug trafficking. (The Wall Street Journal; http://www.wsj.com/articles/venezuelan-officials-suspected-of-turning-country-into-global-cocaine-hub-1431977784?tesla=y)
Venezuela opposition held primaries for high-stakes parliament vote, PRIMERO JUSTICIA leads voteVenezuela's opposition coalition held primaries on Sunday for this year's high-stakes parliamentary election, its best shot in over a decade at recouping the National Assembly at one of the ruling Socialist Party's lowest ebbs. The MUD umbrella coalition has struggled to articulate policy proposals and shake an elitist aura, so Sunday's low-profile primaries were largely a show of mobilization against President Nicolas Maduro. José Luis Cartaya, head of the MUD's electoral committee, says 543,793 voted, which is 7.4% of registered voters. PRIMERO JUSTICIA, which is led by Miranda Governor and former Presidential candidate Henrique Capriles Radonski, won 13 nominations; VOLUNTAD POPULAR, headed by imprisoned leader Leopoldo López, gained 8 positions; the old ACCIÓN DEMOCRÁTICA party secured 7 nominations; UN NUEVO TIEMPO racked up 5; CUENTAS CLARAS, 2; while the traditional COPEI Social Christian party and imprisoned Mayor Antonio Ledezma's AVANZADA PROGRESISTA, won one nomination, each. (Reuters, http://www.reuters.com/article/2015/05/18/us-venezuela-politics-idUSKBN0O20IV20150518; Veneconomy, http://www.veneconomy.com/site/index.asp?ids=44&idt=43918&idc=1; Latin American Herald Tribune, http://www.laht.com/article.asp?ArticleId=2388009&CategoryId=10717; El Universal, http://www.eluniversal.com/nacional-y-politica/150518/turnout-in-primary-vote-of-opposition-coalition-mud-hits-640000; and more in Spanish: El Universal, http://www.eluniversal.com/nacional-y-politica/150518/pj-obtuvo-13-candidaturas-en-primarias-de-la-unidad)
US repeats its concern over freedom of speech in VenezuelaUnited States has again voiced concern about freedom of expression in Venezuela, and insists that "the only way" to solve the troubles in Venezuela is "through a true dialogue instead of trying to silence critics." "We share the concern expressed by the Inter-American Press Association (IAPA). We have urged many times the Venezuelan government to improve the environment of respect for human beings and fundamental liberties, such as freedom of expression and peaceful association," said a spokesperson for the US Department of State. (El Universal, http://www.eluniversal.com/nacional-y-politica/150518/us-reiterates-its-concern-about-freedom-of-speech-in-venezuela)
Palestinian FM "proud" of bilateral relation with VenezuelaRiad al Malki, Palestinian Minister of Foreign Affairs says that his visit here country is an opportunity to boost the bilateral relation. In reference to sanctions imposed by the United States on seven Venezuelan government officials, the Palestinian Minister said that his country rejected all sort of aggressions against Venezuela and added that the people of Palestine supported Venezuela unconditionally. (El Universal, http://www.eluniversal.com/nacional-y-politica/150518/palestinian-fm-proud-of-bilateral-relation-with-venezuela)
Felipe González visit to Venezuela postponed until new López's hearingFormer president of Spain Felipe González will travel to Venezuela when a new date for the next trial hearing of dissenter Leopoldo López is scheduled. González called off his visit to Caracas, which was expected this Monday, when López's hearing was adjourned, AP reported. (El Universal, http://www.eluniversal.com/nacional-y-politica/150518/felipe-gonzalezs-visit-to-venezuela-suspended-until-new-lopezs-hearing)
Venezuela has deported 7,021 Colombians in 3 yearsThe Foreign Office of Colombia reported that from 2012 to date 7,021 Colombians have been deported from Venezuela due to their irregular status. The numbers arrived after the Foreign Office of Venezuela said last Thursday that as many as 494,597 Colombians had entered Venezuela illegally. Based on Venezuelan data, in 2012-2014, the number of illegal Colombian residents was "160,984 in 2012; 189.001 in 2013, and 144,612 in 2014". (El Universal, http://www.eluniversal.com/nacional-y-politica/150518/colombia-in-three-years-venezuela-deported-7021-colombians)
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.