I suspect Chavez will continue to grow more strident in his rhetoric as the price of oil continues to drop.
Venezuala's oil production is dropping due to mismanagement and under investment, and international capital would be insane to invest in Venezuala based on the recent strings of nationalization. The net result is that if oil drops into the $30s he's going to really start feeling the pinch. And it is looking increasingly likely that it *will* drop in that fashion. The Saudi's seem to be pursuing a policy of trying to use lower oil prices to attack Iran, and the world demand for oil is falling (as a response to the higher prices of the last year). Oh yes, and oil inventories are at a record level.
I expect Venezuala to go the route of Cuba: declining economic fortunes due to government mismanagement.
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Date: 2007-01-22 02:30 am (UTC)Venezuala's oil production is dropping due to mismanagement and under investment, and international capital would be insane to invest in Venezuala based on the recent strings of nationalization. The net result is that if oil drops into the $30s he's going to really start feeling the pinch. And it is looking increasingly likely that it *will* drop in that fashion. The Saudi's seem to be pursuing a policy of trying to use lower oil prices to attack Iran, and the world demand for oil is falling (as a response to the higher prices of the last year). Oh yes, and oil inventories are at a record level.
I expect Venezuala to go the route of Cuba: declining economic fortunes due to government mismanagement.