Venezuelan Bonds Decline to Two-Week Low as Crude Oil Plummets
Venezuelan bonds, the worst-performing in emerging markets last year, fell to a two-week low amid a plunge in crude oil.
West Texas Intermediate oil dropped below $50 a barrel for the first time since April 2009. Venezuela’s benchmark bonds due in 2027 decreased 3.75 cents to 43.50 cents on the dollar, set for the lowest since Dec. 17. Petroleos de Venezuela SA’s bonds maturing in 2017 slid 3.51 cents to 53.13 cents on the dollar.
“The oil price is just killing it,” Donato Guarino, a strategist at Barclays Plc in New York, said in a telephone interview. “The fundamentals haven’t changed. What has changed is the oil price.”
Oil fell as Russia’s output increased in December to the highest level since the end of the Soviet Union while Iran said it would boost production. The price of Venezuela’s crude declined last week to $47.05 a barrel, down more than 50 percent since the end of June.
Venezuelan President Nicolas Maduro is traveling to China for talks on financing and energy and expects to visit other OPEC nations to develop an oil-pricing strategy, he said yesterday. The South American country relies on oil for 95 percent of its export revenue.
To contact the reporter on this story: Sebastian Boyd in Santiago at sboyd9@bloomberg.net
To contact the editors responsible for this story: Brendan Walsh at bwalsh8@bloomberg.netDennis Fitzgerald, Rita Nazareth
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