Private oil companies face bleak prospects in Ecuador
Ecuador returned to OPEC after 15 years of absence. The country was accepted as an active member during a rare Heads of State Summit of last November in Riyadh. Measured by its oil production of 540 thousand barrels a day, no big deal. However, Venezuela’s President Hugo Chavez, who leads the pack of price-hawks within OPEC, had good reasons ...
Private oil companies face bleak prospects in Ecuador
Ecuador returned to OPEC after 15 years of absence. The country was accepted as an active member during a rare Heads of State Summit of last November in Riyadh. Measured by its oil production of 540 thousand barrels a day, no big deal. However, Venezuela’s President Hugo Chavez, who leads the pack of price-hawks within OPEC, had good reasons to welcome Ecuador’s homecoming. He sees in the small Andean country an ally and a reinforcement of the trend among oil-rich countries towards growing state control over resources and increased political use of the “oil weapon”. Ecuador’s President Rafael Correa shares with Chavez the conviction that a new type of socialism is the best way to overcome poverty, weak institutions and underdevelopment. He has issued a ‘wake-up call’ from ‘a neo-liberal nightmare’, although Ecuador in fact has hardly ‘reformed’ its economy. So how close is private oil to packing its bags?