Venezuela will keep campaigning until oil prices rebound to $100 per barrel, president Nicolas Maduro said Thursday night after OPEC refused to cut output, as the cash-strapped South American country had aggressively pushed for.
Saudi Arabia blocked calls from poorer members of the OPEC oil exporter group for production cuts to arrest a slide in global prices, sending benchmark crude plunging to a fresh four-year low of around $71.25.
The decision is a blow to Venezuela's flailing economy, widely believed to be in recession, and also highlights the country's diminished influence in OPEC, which it helped found.
But Maduro said the country with the world's largest crude reserves is undeterred.
“For now, it wasn't possible to achieve the proposal we supported with various OPEC members. There was not a consensus to make an important cutback to oil production to recuperate the markets, but above all, to recuperate the price of oil,” he said at a military event, estimating the oil price slump had curbed Venezuela's revenues by up to 40 percent.
Despite concerns over the national budget, Maduro assured citizens that their basic needs will still be covered.
“If we had to reduce something in the budget, we would cut sumptuary costs, we would cut our own salary as high officials, but we will never cut even a bolivar (Venezuela's currency) from money that goes toward education, food, housing... the missions of our people,” he said.
To be sure, the country has an upward battle to win over the wealthy Gulf states that have made clear they are ready to ride out the weak prices.
The prospect of continued low oil prices, however, is disastrous for Venezuela, which is grappling to pay debt arrears to private companies ranging from airlines to oil partners, finance expensive social programs, and make major bond payments.
Earlier on Thursday, Venezuela's Foreign Minister and top OPEC representative Rafael Ramirez vowed to maintain contact with OPEC and non-OPEC countries to monitor markets.
“We have agreed to work toward [price] stability and work to maintain contact with non-OPEC countries, which is very important,” he said in an interview with Latin American regional television station Telesur from Vienna, referring to conversations with oil producers Mexico and Russia that are not part of the group.
But Ramirez's comments were a far cry from the interview he gave Telesur earlier this month from Iran, one of several stops on his unsuccessful global tour to shore up support for an OPEC cut.
Then, a confident-looking Ramirez, until September the country's oil minister and head of state oil company PDVSA, told Venezuelans a consensus for an output cut was in the works.
“The issue isn't even the reduction but rather how much,” he had said.