Venezuela Isn’t Telling the Truth About its Oil Industry
By Roberto A. Ferdman
It appears Venezuela isn’t pumping out nearly as much oil as it claims.
According to the latest monthly report (pdf) released by the Organization of the Oil Exporting Countries (OPEC), Venezuela’s state-owned oil company Petróleos de Venezuela S.A. (PDVSA) is making a habit of reporting production levels well above secondary source estimates. This past August alone, the country’s state-owned oil company reported outputs of roughly 2.8 million barrels a day, nearly half a million barrels above (Spanish link) outside estimates of closer to 2.35 million.
While Venezuela is by no means the only country for which OPEC has noticed discrepancies between national and outside estimates of local oil production, its fibs are among the world’s most egregious. Only Iran, which exaggerates its oil production by closer to a million barrels a day, has proved to be a bigger liar.
Why is the oil-rich South American country telling tall tales? Probably because it can’t boost oil production, which is often used as a proxy for the country’s economic health. The country sits on what’s believed by many experts to be the world’s largest oil reserves. While oil still accounts for the majority of the Venezuelan government’s income, it has been struggling to up its output.
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