CARACAS: Venezuela is still considering raising domestic fuel prices that are the world’s cheapest, and is taking a big hit in revenues due to the global fall in oil prices, President Nicolas Maduro said.
The South American Opec nation receives 96 percent of its foreign currency revenues from oil, so the plunge in global oil prices to four-year lows has left it in a quandary at a delicate time of probable economic recession and foreign debt maturities.
“There’s been a huge fall in the oil (price),” Maduro said in a speech late on Thursday.
“We’ve lost 30 percent of our dollar revenues, in this last month. That’s not a trifle,” he added, without elaborating.
Maduro’s government has previously suggested it could hike the heavily subsidized price of gasoline, which sells for the equivalent of less than six US cents per gallon, or about 1.4 US cent per liter, at the official exchange rate, and less than 1 US cent a gallon at the black market rate.
Officials say the subsidy costs some $12bn per year.
Analysts estimate Venezuela will lose around $700m of export revenue per year for every $1 drop in the price of oil.
Maduro, however, has repeatedly said that both foreign debt payments and social spending, especially on the socialist government’s popular welfare programs known as “missions”, will be guaranteed going forward.
Virgin America soars in market debut
New York: Shares of Virgin America Inc, a low-cost airline partly owned by Richard Branson, soared almost 30 percent in its market debut, underscoring the buoyant mood in an industry that is emerging from a long spell of turbulence.
US airline stocks hit a 13-year high this week as they gained momentum from lower oil prices and increased travel spending by Americans in an improving economy.
The company’s IPO is the first for a US airline since May 2011, when Spirit Airlines Inc went public.
Virgin America’s shares rose to a high of $29.74 on Friday, valuing the company at about $1.3 billion.
“I think it’s a buy-and-hold story,” said Josef Schuster, founder of Chicago-based IPO investment firm IPOX Schuster LLC.
Agencies
