What will Venezuela do with its oil? Top five energy challenges after Chàvez.

With the passing of Hugo Chávez, the issue of what Venezuela chooses to do with its oil moves to center stage for the energy industry – and for environmentalists. Here are five energy challenges that Venezuela will have to face.

5. PDVSA's future

Carlos Garcia Rawlins/Reuters/File
Oil workers work at a petroleum area operated by Venezuelan state oil company PDVSA. With ballooning debt and falling porduction, PDVSA's future is uncertain.

Under Chávez, the national oil company became more than just a company. It funded his social programs, provided foreign aid, and boosted employment. PDVSA has twice the employees it had when Chávez came to power in 1999, even though its production has fallen.

The business approach would be to cut back the bloated payroll and reduce the company's operating costs (and ballooning debt). But with the economy suffering from years of mismanagement, cuts are politically sensitive. Even Mr. Capriles, the opposition candidate in last year's election, said he would not cut jobs at PDVSA.

 Another way to justify the company's bigger payroll is to boost production, something that Venezuela has tried to do, but with little success so far. Pressures may grow to open up its oil industry to more foreign investment if the economy – and oil production – continue to stagnate.

 Privatizing the PDVSA does not appear to be on the table. First nationalized in the 1970s, Venezuela experimented with liberalizing the oil sector. That initiative was quickly squelched when Chávez was elected president. Even the opposition doesn't talk about privatization.

5 of 5

Dear Reader,

About a year ago, I happened upon this statement about the Monitor in the Harvard Business Review – under the charming heading of “do things that don’t interest you”:

“Many things that end up” being meaningful, writes social scientist Joseph Grenny, “have come from conference workshops, articles, or online videos that began as a chore and ended with an insight. My work in Kenya, for example, was heavily influenced by a Christian Science Monitor article I had forced myself to read 10 years earlier. Sometimes, we call things ‘boring’ simply because they lie outside the box we are currently in.”

If you were to come up with a punchline to a joke about the Monitor, that would probably be it. We’re seen as being global, fair, insightful, and perhaps a bit too earnest. We’re the bran muffin of journalism.

But you know what? We change lives. And I’m going to argue that we change lives precisely because we force open that too-small box that most human beings think they live in.

The Monitor is a peculiar little publication that’s hard for the world to figure out. We’re run by a church, but we’re not only for church members and we’re not about converting people. We’re known as being fair even as the world becomes as polarized as at any time since the newspaper’s founding in 1908.

We have a mission beyond circulation, we want to bridge divides. We’re about kicking down the door of thought everywhere and saying, “You are bigger and more capable than you realize. And we can prove it.”

If you’re looking for bran muffin journalism, you can subscribe to the Monitor for $15. You’ll get the Monitor Weekly magazine, the Monitor Daily email, and unlimited access to CSMonitor.com.

You've read  of  free articles. Subscribe to continue.