Posted On 21 Jul 2017
Executives of the main oil companies have said it, and President Lenin Moreno knows it: it is possible that the oil crisis lasts until the end of his presidential term.
Mark McCollum, of Switzerland’s Weatherford International, says this is “the worst (industry crash)” and “could reach 2020 when demand accelerates sufficiently, or a supply gap emerges that US producers could not cover.” “That’s when prices will start to rise. Until then everything is plunged.”
Aware of this, President Moreno has called the private sector, something unusual in this decade, to take safe steps; And the president of the Legislature José Serrano has promised to give facilities to entrepreneurs. The objective is to empower private companies to encourage the income of dollars.
With the current price of the barrel of oil, the state does not project income to the budget. A price of $ 48 per barrel is barely enough to pay the cost of extraction, commercialization, and import of derivatives. In 2015, the Government did not record revenues, and in 2016 just $ 750 million entered the treasure through oil presales. In 2017, zero dollars have entered the state coffers.
Thus, Ecuador would be forced to produce more primary goods from the private sector, such as bananas and shrimp; In addition to generating local grain production to avoid the bleeding of dollars by imports of soy, maize and other goods that can be replaced with domestic production. (I)