Venezuela Passes Saudis to Hold World’s Biggest Oil Reserves

Venezuela surpassed Saudi Arabia to become the world’s largest holder of proven oil reserves, a resource that President Hugo Chavez promises to tap if he gets re-elected in October.

The South American country’s deposits were at 296.5 billion barrels at the end of last year, data from BP Plc (BP/) show. Saudi Arabia held 265.4 billion barrels, BP said yesterday in its annual Statistical Review of World Energy. The 2010 estimate for Venezuela increased from 211.2 billion in the previous report.

“These reserves are quantified and certified by third parties and recognized by the entire world as being the biggest proven reserves of the world,” Venezuela’s Oil Minister Rafael Ramirez said today in Vienna. “We have always said that in the future the natural resources will become scarce and when the economy recovers and demand will come back then we will be one of the few countries able to respond to that.”

Chavez wants to more than double the country’s oil- production capacity to 6 million barrels a day by 2019, according to a government plan released June 12. The world’s biggest oil-exporting nations faced a 15 percent slump in crude prices last month, the biggest decline since December 2008, on speculation Europe’s debt crisis would derail the global economic recovery.

Ramirez has said oil prices need to be higher than $100 a barrel. The recent slump in crude is dangerous for producers, the oil minister said June 12 in Vienna, where the Organization of Petroleum Exporting Countries is meeting today to decide production quotas.

Canada Third

Brent futures fell 14 cents, or 0.1 percent, to $96.99 a barrel on the ICE Futures Europe exchange at 4:04 p.m. London time today.

Global reserves advanced to 1.65 trillion barrels at the end of last year, a 1.9 percent increase from a revised 1.62 trillion in 2010, BP said. Venezuela now holds 18 percent of the world’s reserves, according to BP data.

BP revised its estimates on reserves in part because the company publishes its report in June, before most governments issue their annual reserves figures, said Robert Wine, a BP spokesman. Last year’s record average oil price also had an effect, increasing the commercial viability of hard-to-reach deposits, he said.

Saudi Arabia now trails Venezuela with a 16 percent share of world proven oil reserves, according to the report. Canada ranks third with 175.2 billion barrels, or 11 percent of total, unchanged from the revised number for 2010.

Development Difficulties

Venezuela’s deposits may be difficult to extract, according to Strategic Energy & Economic Research. “People still know that a lot of that is very hard to develop and is not as readily accessible the way Saudi reserves are,” Michael Lynch, the researcher’s president, said today in Vienna. “It’s the same with Canadian oil sands.”

Russia boosted its deposits to 88.2 billion barrels from a revised 86.6 billion a year earlier, according to BP. Russia’s share of the total is 5.3 percent.

Reserves in Norway increased last year, snapping 11 years of declines, according to BP. The country’s deposits rose to 6.9 billion barrels, compared with a revised figure of 6.8 billion in 2010.

BP said the estimates in yesterday’s report are a combination of official sources, OPEC data and other third-party estimates. Deposits include gas condensates and natural-gas liquids, as well as crude.

To contact the reporter on this story: Rupert Rowling in London at rrowling@bloomberg.net

To contact the editor responsible for this story: Stephen Voss at sev@bloomberg.net

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