Construction interests in Venezuela are watching with concern as the country struggles to recast its budget to handle new economic pressures brought on by a precipitous fall in the price of oil in the past year. More than 90% of Venezuela’s export revenue comes from oil. But petroleum prices have plummeted more than 50% in the past nine months, triggering a dramatic budget shortfall in South America’s leading oil-producing country. In a nationally televised announcement on March 21, Venezuela President Hugo Chavez unveiled a package of austerity measures and tax hikes to handle the growing economic pressures.
The nation’s original budget for 2009 was based on an annual estimated oil price of about $60 per barrel, but, as of March 31, the average price for the year was less than $37. The new budget is based on a $40-per-barrel price over the course of 2009, Chavez said in his address.