Update On Venezuela -- September 9, 2017 -- My Reading Of The Update? China Owns Venezuela; Russia Wants A Piece

Disclaimer: I know nothing about The DVA Group nor The Selinger Group. I'll sort that out later. I don't know how reliable their website Venezuelan Daily Brief is or if the group has an agenda. This is the first time I've come across the blog. Interestingly enough, it uses the very same "blogger" application that I use and the very same domain.

The website is updated "bi-weekly" or every two weeks. The most recent update is dated August 29, 2017. The previous post was dated August 17, 2017.

These are the data points from the current post that jumped out at me:

• Venezuela exports to the US: huge drop since 2006; nothing new; data is posted frequently on this blog, and a link provided; what I'm interested in is more current, weekly data
• Venezuelan oil minister and the state oil company president will switch roles; the latter will go on a series of foreign trips to strengthen alliances
• the new president of PDVSA will  will be tasked to strength partnerships with foreign companies operating in the Orinoco Belt by improving their stakes
• the oil minister will Russia and Saudi Arabia head of an OPEC, non-OPEC monitoring ministerial committee meeting in Vienna, set for September 22, 2017
• PDVSA said it was negotiating the continuation of its lease of Curacao's Isla refinery but was open to Chinese partners following a preliminary deal between the island and China's Guangdon Zhenron Energy to operate the complex
• the cash-poor PDVSA has been reluctant to invest some US$ 1.5 billion that Curacao authorities requested several years back to modernize the 335,000 bopd facility
• op-ed: 
• Venezuela is on the verge of becoming a failed state
• the implosion will not drive up global oil prices
• Venezuela will protect oil exports at all costs
• even if unsuccessful, percentage of total demand is small and easily offset by other OPEC and non-OPEC nations
• if production were cut off, it would not stay cut off
• Venezuela has huge debts outstanding with the US, China, and Russia -- any government desperately needs oil revenue
• more at the op-ed
• White House sanctions may scare off Venezuela vulture investors -- see article
• sanctions are severe, but if Maduro doesn't meet Trump's demands, Trump could make them even more severe -- see article
• Venezuelan cash:
• "disposable reserves": down to US$ 700 million
• international reserves available for imports, debt service, contingencies, etc, were down to $US$ 9.855 billion on August 22, the lowest level in 15 years -- but now the situation is even worse -- see article
• most "disposable reserves" are being held in gold bullion
• remember: "disposable reserves" at $700 million and PDVSA must pay US$2.9 billion in debt service during October and November
• the government is considering using gold bullion to leverage additional resources
• walls close in on Venezuela with US bond sanctions -- see article
• Venezuela has a US$ 3.5 billion bond payment coming due by November
• Trump's sanctions may make it impossible for Venezuela to re-structure its obligations
• Goldman Sachs? the company bought US$2.8 billion of notes issued by PDVSA in May, 2017 -- sharp criticism in the US, but the bonds were exempt from Trump's orders/sanctions
• a member of the pro-regime "Constitutional Assembly" says that the Maduro regime is negoatiating with China for the resale of Venezuelan bonds; hold that thought:
• shortages have ameliorated but shortages have not gone away; shelves are fuller than Venezuela has seen for months (see why at the article) but most shelves contain a single variety of any given product, much of it imported from China
• China stopped lending Venezuela new money but in 2016 still had a reported US$ 20 billion of loans outstanding

When I put that all together, this would be the 30-second, elevator speech: China owns Venezuela and Venezuela is already negotiating with China on certain oil sector assets.

For newbies, it is not unusual for cash-strapped countries and/or companies in the oil business to trade oil production in exchange for services or other production. For example, oil service companies like Schlumberger will take "payment" in the form of oil production in some cases.