Venezuelan President in Tehran

Venezuelan President Nicolas Maduro arrived in Tehran today looking for Iranian financial help to save its economy with oil prices plunging to $50 per barrel. Oil constitutes 95 percent of Venezuelan hard-currency export earnings. With prices so low, Venezuela is facing serious problems paying for its sizeable social projects, and the country is at risk of financial default in the coming months.

Maduro is on a tour to Russia, China, Iran, Saudi Arabia and Algeria looking for help. Aside from China, all the other countries he’s visiting are dealing with falling oil prices.

Iran and Russia have to face $50 oil on top of economic sanctions imposed on them because of nuclear and Crimean issues respectively. Iran is losing more than $2 billion a month in export revenues compared to last June when oil was at $114. The Iranian and Russian economies could be facing recession, currency crisis, and runaway inflation. How they could help Venezuela was not clear. China can and is buying large volume of crude from Venezuela at rock-bottom prices.

Photo credit: Venezuelan President Nicolas Maduro (l.) being greeted by Iranian President Hassan Rouhani during his official arriving ceremony at Saadabd Palace in Tehran; Saturday 10 January 2015 (Twitter @Rouhani_ir)

Venezuela Oil Minister in Tehran

Venezuelan Oil Minister Asdrubal Chavez arrived in Tehran on Monday for talks with Iranian Oil Minister Bijan Zanganeh and other ministry officials on oil price crisis. In last OPEC meeting on 27 November, Venezuela pushed hard to curb output to stop the decline in prices, but OPEC decided to maintain current production ceilings.

Low oil prices have particularly hit Venezuela hard, with the country on the brink of financial default.

Meantime, Brent crude prices hit five-year low on Monday. Today, Brent futures rebounded a bit, but still trading at $66.44 a barrel for January delivery.

Photo credit: Iranian Oil Minister Bijan Zanganeh (r.) greeting his Venezuelan counterpart, Asdrubal Chavez; Tehran, 8 December 2014 (FNA)

Fall in Oil Prices Pushes Venezuela Closer to Default

Last week’s OPEC decision to maintain the current oil production levels has pushed oil prices to five-year lows. The falling prices are putting particular pressure on oil producers without sufficient financial reserves, starting with Venezuela, a country that relies overwhelmingly on oil revenues, accounting for 96 percent of its foreign reserves.

“The fall in oil prices pushes Venezuela even closer to default. Given that the government has nothing in the way of savings from the oil price boom of the past decade, the loss in oil revenues will wipe out whatever foreign currency that the government has,” said David Rees, an analyst at Capital economics. (Arab News, 5 December)

Meantime, Chinese economy minister will arrive in Caracas today. China, taking advantage of falling revenues in countries like Venezuela, is believed to be stockpiling large volumes of crude at rock-bottom prices.

Nigeria, Iran and Russia have also been affected hard by the falling oil prices. The national currencies have fallen rapidly against dollar. Nigeria has massively devaluated the naira. In Russia, the ruble has accelerated its decline, losing more than 60 percent of its value against dollar this year. The rial has also lost more than 17 percent of its value in 2014, mostly in the past two weeks.  

Photo: Getty Images

Ahmadinejad to Attend State Funeral of Chavez

Iranian President Mahmoud Ahmadinejad will attend the state funeral of the late Venezuelan president Hugh Chavez in Caracas on Friday. He called Chavez “a dear friend of Iran” and “an anti-imperialist leader.”

“As long as justice, love and freedom are alive, Hugo Chavez will be alive as well. As long as faith, purity and humanity are alive, he will be alive too. As long as nations are alive and strive for the materialization of independence, kindness and justice, he will be alive too,” Ahmadinejad said in a message to Venezuelan acting president Nicolas Maduro. (Fars News Agency, 6 March)

President Chavez, who died Tuesday, developed a close relationship with Ahmadinejad and other senior Iranian leaders and visited Tehran many times. The Iranian government declared Wednesday a day of national mourning across Iran.

File photo: The late president Hugo Chavez greeting his Iranian counterpart Mahmoud Ahmadinejad in Caracas, June 2010. (IRNA) 

Venezuelan President Hugo Chavez Dies at 58

Populist Politician and A Revolutionary

President Hugo Chavez died today after losing a long and hard fought battle with cancer. He was 58.

The former paratroop commander and populist politician waged continual battle for his socialist ideals, winning re-election three times.

Chavez was one of the closest allies of the Islamic Republic at the world stage and had visited Tehran on a number of occasions.

In a memorable interview with The Associated Press in 2007, he called himself “a subversive revolutionary.”

“I'm still a subversive,” the late president told AP, recalling his days as a rebel soldier. “I think the entire world has to be subverted.”

Photo credit: Yahoo! News

XVI NAM Summit Ends

The 16th Summit of the Non-Aligned Movement (NAM) wrapped up today in Tehran. Venezuela will host the next NAM Summit in 2015.

Photo Credit: ISNA