Home
Subscribe (free)
About NaturalNews
Contact Us
Write for NaturalNews
Media Info
Advertising Info

Venezuela to plunge into mass social unrest if oil prices stay low, warn analysts


Venezuela

(NaturalNews) For countries that depend primarily on oil revenues to fund government services, hard times are upon them. And they are likely to continue, analysts say.

That's because oil prices have collapsed, thanks to several different factors, and while that is good news for consumers, truckers, airlines and other industries that rely on oil products to produce goods and services, it's bad for the producers of oil, and for nations that depend on oil sales to fund everything from social service and welfare programs to defense.

Venezuela is one such country. Already mired in deep depression thanks to the government's socialist policies, the South American nation cannot take a loss of oil revenue without suffering mass unrest, say analysts who have been monitoring that country and others dependent on the "black gold" for most of their revenue.

As reported by Fox Business:

With Wall Street shops like Goldman Sachs and government officials in Venezuela signaling oil could go to the mid-$20 per barrel range next year, analysts at places like RBC Capital Markets have been warning that chronically low oil prices plunging towards seven-year lows means increasing social chaos in countries on the edge—including those battling ISIS.

The 'Fragile Five'

There are five countries in particular that analysts are watching for signs of increased social unrest because of low oil prices, which RBC Capital has described as the "Fragile Five" – Algeria, Iraq, Libya, Nigeria and Venezuela, and most of these are believed to have been infiltrated with ISIS operatives.

Richer Gulf State countries can at least temporarily adapt to lower oil prices by borrowing in the bond market or boosting tax revenues, while cutting some government spending – though the latter measure would risk more social unrest from populations like Saudi Arabia overly dependent on government for income.

In one case already, Fox Business reported, the United Arab Emirates has ended fuel subsidies and is considering implementing corporate and sales taxes.

In all, OPEC member nations have sat helplessly watching as oil revenues plunged by almost $500 billion over the past year; the price of oil, on average, has fallen by more than 40 percent, and again, is expected to fall lower.

As Fox Business reported further, falling oil revenue is also hurting the war against terror:

Plummeting oil prices are slamming poorer countries, who are dealing with terrorism as well. Already, 1.6 million have been internally displaced in South Sudan, with another 600,000 refugees in neighboring countries on the move. South Sudan has been battling a civil war for more than a year and a half in the oil-rich southern part of the country, an area that's bigger than Syria. In 2011, the year of its independence, South Sudan was pumping out almost 350,000 barrels of oil per day, but today can only produce 120,000 to 150,000 barrels a day.

Unrest is coming

For its part, Venezuela is nearly insolvent as it reels from the collapse in oil prices – which has been in large part due to the boom in the U.S. shale oil industry – and rising social unrest, which had already begun due to a weakened economy and chronic shortages of basic goods. The government asked OPEC to help get oil prices back up to the $88-per-barrel range during the cartel's Dec. 4 meeting, as Venezuela's government bonds fell to near-junk status.

Other "Fragile Five" countries are facing similar conditions, including Iraq, which has been battling ISIS daily. Baghdad wants to borrow $6 billion in new bond debt, something the country has not had to do in about 10 years. The issuance of bonds came as Iraqi oil output hit 4.18 million barrels a day, a record high, and well above the average of 3.42 million barrels per day during the first quarter.

The Saudi government – which is also battling jihadists domestically and in Yemen – has borrowed more than $9 billion since the summer, as is facing a fiscal deficit of about 20 percent of GDP.

Sources:

FoxBusiness.com

NaturalNews.com

MarketWatch.com

Join the Health Ranger's FREE email newsletter
Get breaking news alerts on GMOs, fluoride, superfoods, natural cures and more...
Your privacy is protected. Unsubscribe at any time. | Learn more...

comments powered by Disqus
Most Viewed Articles


Support NaturalNews Sponsors:

Support NaturalNews Sponsors:

The War on Independent Media Has Begun

A coordinated censorship attack is being waged against the entire independent media by Google, YouTube and Facebook. After we were banned by Google for nearly a week, now Facebook is deliberately blocking the sharing of our stories to further censor our important reporting for human freedom and medical choice. Soon, the only way we will be able to reach you is via email, and Google is sometimes blocking our email delivery to gmail users.

Enter your email address below to subscribe to our email announcement list (but don't use gmail). Your privacy is protected and you can unsubscribe at any time. If you don't join our email list, you may never see our valuable content again via Facebook, Google or YouTube. CENSORSHIP has now reached EXTREME levels across the 'net. The truth is being suffocated. Subscribe now if you want to escape the delusional bubble of false reality being pushed by Google and Facebook.

Once you click subscribe, we will send you an email asking you to confirm your free subscription.