Basic goods shortages, runaway inflation and a debased currency are suffocating Nicolas Maduro\u2019s two-year presidency.<\/p>\n
As sliding oil prices halt drilling and deprive it of vital export earnings, fossil fuels for the OPEC member with the planet\u2019s largest proven oil reserves are everything.<\/p>\n
\u201cThe Orinoco Belt is the cash cow,\u201d Russ Dallen, a Miami-based head bond trader at Caracas Capital Markets, said of the\u00a0513 million barrel basin<\/a>\u00a0of heavy crude deposits. \u201cAside from oil, the government has no other means of income.\u201d<\/p>\n Confronting climate change is decidedly low on the priority list for the country with Latin America\u2019s second dirtiest energy sector.<\/p>\n Climate justice fighter<\/strong><\/p>\n But it is has been a prominent voice throughout years of UN-backed negotiations to broker a global\u00a0agreement.<\/p>\n Venezuela clamours for rich nations to assume \u201chistoric responsibility\u201d in causing climate change, heaping scorn on the United States and the West in appeals for climate justice. Western observers, for their part, see it as a truculent saboteur of climate talks .<\/p>\n Its revered former leader Hugo Chavez\u00a0said<\/a>\u00a0if the climate were a bank, the West would have bailed it out already.<\/p>\n Maduro accused wealthy countries of profiteering from pricing pollution, and\u00a0slammed<\/a>\u00a0American fracking at a UN summit in 2014 as environmentally destructive.<\/p>\n \u201cVenezuela\u2019s pitching of capitalism versus socialism is a huge oversimplification of the problem of climate change,\u201d said Amanda Maxwell, who heads the Latin America program at the National Resources Defense Council in Washington.<\/p>\n \u201cIt\u2019s an admirable thing their support for climate justice, but if you deem it and environmental justice to be related, the environmental issues at home really contradict the rhetoric.\u201d<\/p>\n Thaw with UN partners<\/strong><\/p>\n Relationships with Western partners have warmed since the acrimonious Copenhagen summit in 2009, according to chief negotiator, Claudia Salerno, who\u00a0dramatically<\/a>\u00a0cut her palm trying to get attention.<\/p>\n Venezuela protested loudly among other developing nations that a select group of countries had cooked an agreement, embittering years of subsequent talks that are finally set to be signed off this December in Paris.<\/p>\n \u201cThe most beautiful thing about Paris is that it will be the end of an exhausting process of negotiation since Copenhagen to here,\u201d Salerno told RTCC. \u201cNow all the world is willing it.\u201d<\/p>\n But old tensions remain.<\/p>\n As up to 200 countries ready pledges to collectively slash greenhouse gas emissions, Venezuela won\u2019t back a deal that bullies poorer countries for not cutting enough, Salerno said.<\/p>\n Market mechanisms, which allow pollution permits to be traded, are another red line for the socialist country.<\/p>\n Nor will it bow to the UN climate change organisation\u2019s call for pledges by October. It wants to assess all countries\u2019 climate plans ahead of the Paris summit, to see how close they get to holding temperature rise to 2C \u2013 an internationally agreed aim.<\/p>\n \u201cThere is no deadline for Venezuela. If it happens in December, great, but we welcome January also for all countries. You can\u2019t remove anybody ex ante because the [UN] secretariat wants a webpage complete,\u201d Salerno added.<\/p>\n Oil lifeblood<\/strong><\/p>\n The country\u2019s obduracy hinges on oil\u2019s dominance in its economy, which provides\u00a095%\u00a0of export earnings<\/a>\u00a0and a quarter of national income.<\/p>\n Consuming\u00a0800,000\u00a0barrels a day<\/a>\u00a0of petrol and diesel, fossil fuel subsidies total US$12 billion a year. With a gallon of petrol costing about\u00a0ten cents<\/a>, people lavish it on gas-guzzling SUVs.<\/p>\n Oil minister Rafael Ramirez has said the cost of supplying refined gasoline for mass consumption is about US$70 a barrel. Oil prices plummeted 60% in the past year to a low of $40 a barrel, and now hover at $60.<\/p>\n The IMF sees Venezuela\u2019s economy contracting 7% in 2015 as price inflation rises 96.8%.<\/p>\n \u201cVenezuela sees the global climate regime as a threat to its national interests,\u201d Guy Edwards at Brown University\u2019s Climate and Development Lab told RTCC.<\/p>\n Beyond big hydropower it has little intention to shift to cleaner forms of energy or stem oil exports which fuels its economy, he added. Frozen out of capital markets, Venezuela has snapped up a\u00a0reported<\/a>\u00a0$56 billion of Chinese investment since 2005. For China, the draw is not bolivars \u2013 which have slid to\u00a0170 bolivars<\/a>\u00a0to the dollar from 10 in 2012 \u2013\u00a0but energy security, with payment in oil.<\/p>\n Decarbonisation<\/strong><\/p>\n There are\u00a0mounting calls<\/a>\u00a0for a long term goal to decarbonise the global economy this century, in line with the 2C warming goal \u2013 effectively spelling an end to fossil fuel use.<\/p>\n But Salerno batted away the issue, citing Venezuela\u2019s vast rainforests that suck up carbon dioxide.<\/p>\n These carbon sinks together with \u201clow\u201d oil consumption \u201cdecarbonised\u201d Venezuela, according to Salerno: its 0.5% share of global emissions is \u201cpractically insignificant\u201d.<\/p>\n Shipments to the top markets US and China for its oil absolved it of responsibility for the combustion of the dirty fuels, she said.<\/p>\n Almost three-quarters of the country\u2019s electricity generation comes from hydropower, although neglect in the face of high running costs had seen diesel-fired plants imported to stem frequent blackouts, Dallen told RTCC.<\/p>\n No very large hydro plants are planned for the next ten years,\u00a0according<\/a>\u00a0to the Hydropower & Dams World Atlas. And more\u00a0frequent droughts<\/a>\u00a0as the planet overheats undercut the reliability of water flow as a source.<\/p>\n Clean energy<\/strong><\/p>\n Edwards said Venezuela could work together with other Latin American countries to advance the climate agenda. Uruguay seeks to get\u00a095%<\/a>\u00a0of its electricity from renewables this year, while Peru and Chile are targeting solar and wind power.<\/p>\n There is little sign of Venezuela joining that movement.<\/p>\n Indeed, it has come under fire for demoting its environment ministry, the first of its kind in Latin America,\u00a0to become part of the ministry of housing, habitat and \u201cecosocialism\u201d.<\/p>\n Salerno insisted the move strengthened the green agenda; transformation of the country\u2019s energy matrix going hand in hand with the \u201cchavista project\u201d to develop rural economies.<\/p>\n \u201cThis interconnectivity between economy and ecology doesn\u2019t occur in any other country,\u201d she said. \u201cWe are undergoing a revolution in how we manage nature.\u201d<\/p>\n Oil or more oil<\/strong><\/p>\n In the absence of clear plans for green growth, politicians across the spectrum continue to look to oil for economic salvation.<\/p>\n Chavez nationalised the assets of Exon Mobil, ConocoPhillips and other foreign oilers.\u00a0Chevron, Repsol, Eni have pledged to tap the Orinoco basin, though companies are in no hurry to get there, given the weak investment environment.<\/p>\n Maduro\u2019s\u00a0popularity is waning<\/a>, which could give an opening to the centrist opposition leader Henrique Capriles.<\/p>\n But a change at the top would be unlikely to diminish enthusiasm for oil, said Dallen.\u00a0\u201dThe twist of irony is the return of a government that respects property rights and brings investment will lead to more oil production.\u201d<\/p>\n Salerno is unapologetic.<\/p>\n \u201cOil is one of the most marvellous energies in the world. In 200 years it\u2019s going to be used for medicine, science, going to the moon,\u201d she said.<\/p>\n \u201cIt is precious and must be saved for glorious ends, not for making bags to carry back from the market.\u201d<\/p>\n This article was originally published by RTCC<\/a>. To view the original article click here<\/a>.<\/em><\/p>\n <\/p>\n","protected":false},"excerpt":{"rendered":" More oil rather than less for crisis-stricken petro-state as it resists overhaul of fossil fuels<\/p>\n","protected":false},"author":40000225,"featured_media":50002647,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[761],"tags":[513,547],"hashtags":[],"country":[50002604],"class_list":["post-50002646","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-climate","tag-carbon-emissions","tag-fossil-fuels","country-venezuela"],"acf":[],"yoast_head":"\n
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