Venezuela faces long road to rebuild oil production

Chevron’s agreement to boost output is a positive sign, but there is much more work to do for a national recovery

Optimism that Chevron’s decision to expand its operations in post-Maduro Venezuela will herald a quick increase in oil production understate the hurdles created by weaknesses in infrastructure and institutions. Chevron in April signed new agreements to expand production in the country. The company will increase its stakes in joint ventures in the Orinoco oil belt and aims to increase oil output growth in the country by up to 50% over the next two years. The agreement is “constructive at the margin”, but “should not be confused with a general recovery of the Venezuelan oil industry”, said Steve Hanke, professor of applied economics at Johns Hopkins University. There will be no quick rebound i