The Venezuelan economy is showing new warning signs on its dashboard. The slow recovery of the last three years, after the economic crash of the 2014-2020 period, faces several risks in the first quarter of 2025. Donald Trump’s decision to cancel the license for the multinational Chevron to operate in Venezuela threatens a serious budgetary imbalance that augurs new economic storms.
After successive political crises and economic devastation over the past 25 years the Venezuelan economy, with its industry and export apparatus at historic lows, is even more dependent on its oil and petrochemical revenues. After a period of relative stability, the official exchange rate has depreciated by 81% since September. A year ago, one U.S. dollar was valued at 36 bolivars. Today, it is 64. The differential between the official dollar and the parallel one, which is already sold at 73 bolivars, shows a gap of 27%, with a tendency to grow.
Inflation, which seemed to have been averted in mid-2024, has climbed again: in January, it jumped to 7%, a very high figure for the first month of the year and one that the Central Bank of Venezuela recognizes at 4%. Venezuelan salaries remain the lowest in the region. Caracas is coming off economic growth of close to 4% of GDP in 2024 and had planned for a relatively similar rate, perhaps somewhat lower, according to some sources, for 2025. Obviously, that was before the Chevron news.
Venezuela would have to post double-digit growth rates for several years to recover its former size, during which time it was the fifth-largest — sometimes the fourth — economy in Latin America, before Nicolás Maduro came to power. The impact of Chevron’s departure from Venezuela’s weak productive structure will be apparent when the terms of its exit are clear. Formally, the company would have six months to leave while maintaining operations until August 1 (which would mean that its dollars would continue to flow into the Treasury until then). There are, however, those who maintain that there is interest in Washington in hastening the multinational’s withdrawal, according to Venezuelan information circles in Miami. There is also talk of new negotiations and a new energy agreement between Maduro and the United States. The situation has become confused.
“Without oil licenses for foreign companies, Venezuela will hardly see growth this year and in the years to come. We would have, once again, inflation of more than 100% by the end of 2025, and an exchange rate far from current levels. Oil production will inevitably fall. Although PDVSA can take over operations in these fields, it will have a hard time making maintenance investments, which require a lot of money and technology,” says Luis Oliveros, economist and academic at the Metropolitan University of Caracas.
Like other economists, Oliveros thinks it likely that Trump will seek some new energy agreement with Maduro, designed on his terms. A good part of the Venezuelan opposition, led by María Corina Machado — but particularly the citizens in exile — view these measures against Chevron operations with favor. A minority but visible sector of the democratic field within the country, however, has issued fresh warnings about the terrible economic consequences that Chevron’s departure would have.
After producing 3.2 million barrels a day in its prime, PDVSA could now be at as little as 650,000. Unlike what occurred at the end of the 20th century, the country urgently needs international investments to maintain equipment and oil wells that will allow it to sustain and increase current production.
“If Chevron leaves in March, the consequences for the state would be much more severe, and everyone would feel them immediately,” says Leonardo Vera, president of the National Academy of Economic Sciences. “Chevron puts $200 million a month into the exchange market that would no longer exist, and that market is already in crisis. Its departure would also have a fiscal impact. The official dollar could go to over 100 bolivars by the middle of this year. All of that with high inflation, new wage declines, and a contraction of between one and two points of GDP. If the exit is gradual, there could be some movement this year and the effects will be delayed until the end of 2025 and the beginning of 2026.”
Maduro has reacted to Trump’s decision: “There is no threat in this world that intimidates us. We can negotiate with the United States if they want, in a relationship based on respect. But if not, we will continue working on our project. We do not expect anything from the imperialists.”
Vice President Delcy Rodríguez has been visiting countries such as Turkey and India for some time now to seek new oil investment agreements that could replace the departure of Western companies from Venezuelan oil fields, which have the largest reserves in the world.
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