Friday, August 1, 2014
Venezuela & Oil: Will U.S. Drivers Be Affected?
COLUMBIA, S.C. (WOLO/CNN) -- "Chavez was a very charismatic figure who led a populist government and everything we know about populist governments is that they don't handle transition to a new leader very well," says Robert Cox, USC Political Science Professor
Venezuela, home to one of the world's largest crude oil reserves, may be in uncertain political times but when it comes to oil, Cox says, that's not the case.
"They've got resources and they've got production and they have a strong position on the markets," says Cox
While experts say the country is rich in an abundance of oil, Venezuela isn't producing as much when compared to years past.
14 years ago when Hugo Chavez took power the country was producing about 3 million barrels of oil per day, today that number is down to 2.5 million.
A big question now is whether the country will open up it's oil reserve that is said to have a supply of at least 200 billion barrels.
"If they need more cash, that wouldn't be, they won't do it for any consideration for market demand," says Cox.
Crandall Sims reporting,"So what does all this mean for you? While Venezuela is the 4th largest oil provider to the United States and its state oil company PDVSA does own brands like Citgo, experts say in the short-term it's unlikely drivers will see any affects from change of power."
"I don't think drivers will notice a lot and certainly won't notice it in a way that can connect to Chavez's death. Because, prices will show up after they've reached refineries, any change in supply in raw crude oil is not going to be felt by the gasoline consumer."
Wind: 7 MPH
Humidity: 87 %