Venezuela, already in economic chaos after falling oil prices severely hurt the nation, now faces even more trouble as oil production declines. The Venezuelan government depends on oil and natural gas sales for 95 percent of its revenue and analyst Jose Manuel Gonzalez say only increased oil production, which will help offset low prices, can pull the country out of economic disaster. Venezuela imports almost all of its of basic goods; there isn’t any economy except for oil.
What happened to the PDVSA, Venezuela’s state-owned energy company? It used to be a cash cow for the government, funding popular social programs, such as subsidized food and free education. Unfortunately Manuel Gonzalez says, paying for social programs meant less money to maintain the infrastructure needed to refine the oil.