June 24 (Bloomberg) -- Venezuela’s government and central bank approved a bond sale by state oil company Petroleos de Venezuela SA, Finance Minister Ali Rodriguez said today in Maracay, Venezuela.

The bonds will be denominated in bolivars and the money will be used for domestic operations, Energy and Oil Minister Rafael Ramirez told reporters separately.

PDVSA is raising funds after falling behind on payments to oilfield services contractors following a plunge in oil prices in the second half of 2008. Ramirez said the company will make the details of the bond sale public soon.

Venezuela depends on oil exports to finance half the government budget. Ramirez said today that while oil prices have been rising, there is still “instability” in the market.

A de facto floor on oil prices of $55 a barrel has been established, Ramirez said. OPEC remains committed to agreed-upon output cuts and while inventories have fallen a “little,” they remain high, he said.

To contact the reporters on this story: Matthew Walter in Caracas at mwalter4@bloomberg.netJose Orozco in Caracas at jorozco8@bloomberg.net

Last Updated: June 24, 2009 17:33 EDT