Say what you want about Hugo Chavez. Tyrant, socialist, narcissist – he was all those things.
Chavez did a lot of things wrong during his 14-year tenure as Venezuela’s president. But oil wasn’t one of them.
Now that the controversial Venezuelan leader is dead, it leaves major question marks about his country’s economy. Namely – what happens to all that oil?
Venezuela boasts the world’s largest oil reserves. And despite its president’s outspoken distaste for America, Venezuela is the fourth-largest oil exporter to the U.S. at 906,000 barrels a day last year.
Will that change now that Chavez is dead? With no successor in place, it’s way too early to tell. But a slowdown in Venezuela’s oil exports could put pressure on oil prices – something that could drive prices at the pump up even further, and potentially tighten the screws on already sluggish U.S. economy.
At present, oil exports account for more than 90% of Venezuela’s currency inflows, according to the BBC. However, the country’s economy was the worst performer in Latin America over the past decade in terms of GDP growth.
That could be enough to convince Chavez’s successor to diversify Venezuela’s economy away from its overreliance on oil.