Chavez New Windfall Tax to Hurt Partners More Than PDVSA, Barclays Says
Venezuela, South America’s largest OPEC producer, taxes oil companies more than any other country in the world and it recovered about 50 percent of the revenue from each barrel of oil sold over the past five years. On average, more than 90 percent of the gross profit of the oil industry is transferred to the state, according to the e-mailed Barclays report today.
“In the case of the joint ventures there could be some additional fiscal pressure,” Barclays analysts led by Alejandro Grisanti said in the report. “They do have to assume part of the burden of the tax, lowering profits, which does not help create incentive for investment.”
Venezuelan President Hugo Chavez on April 21 said the increased windfall tax will get as much as 95 percent of marginal revenue when oil surpasses $100 a barrel. Venezuela’s government has been pressuring partners to increase production.
Oil for June delivery rose 31 cents to $113.17 a barrel at 10:32 a.m. on the New York Mercantile Exchange. Futures are up 6 percent in April and have advanced every month since September.
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