Venezuela

It’s pay day for $1.125 billion of Venezuelan sovereign bonds. But no one is expecting to get any money. After all, the bond in question is already in default due to a missed interest payment back in February, Bloomberg News reported. Why would Nicolas Maduro’s government fork over hundreds of millions of dollars it can’t afford to part with when the nation and its flagship oil company are already about $5 billion in the hole with creditors? The one new thing today is that this missed payment will mark the first default on government bond principal, rather than just interest payments.

As Venezuela's state-owned oil company PDVSA saw its finances devastated by low oil prices and mismanagement, it funnelled millions of dollars to Petrolera del Conosur, a loss-making Argentine gas station operator it controls, the International New York Times reported on a Reuters story. PDVSA decided to cut off the support payments late last year, according to a person familiar with Petrolera del Conosur's operations, as the once-proud icon of Venezuelan oil production struggled with declining output aggravated by a worsening economic crisis.

The world oil market is notoriously quick to react to headlines, but a seemingly significant one last week from the owner of the world’s largest reserves didn’t cause so much as a blip, The Wall Street Journal reported. According to reports, all from Venezuelan authorities, the China Development Bank earlier this month pledged either $250 million or $5 billion “in favor of the increasing and strengthening of the country’s oil production.” That Venezuela’s major industry needs “increasing and strengthening” is beyond question.

A group of investors holding more than $8 billion of bonds issued by Venezuela and its state-owned companies said that nation must treat its creditors equally, and it won’t support any debt restructuring that doesn’t, Bloomberg News reported.

Venezuela's central bank in April paid $172 million (£128.8 million) to U.S. bank Citigroup to recover part of the gold it had put up as guarantee in a swap operation, according to two sources familiar with the situation, the International New York Times reported on a Reuters story. Sanctions levied by U.S. President Donald Trump last year bar U.S. banks from carrying out financing operations with Venezuela, meaning such swaps cannot be renewed. "Citibank got paid," said a local finance industry source familiar with the negotiation who asked not to be identified.

Three hedge funds that own defaulted Venezuelan bonds hired a Washington law firm to explore legal options for repayment, Bloomberg News reported. The group owns more than 15 percent of the $1.5 billion outstanding of Venezuela’s 2034 bonds, according to Mark Stancil, the attorney at Robbins, Russell, Englert, Orseck, Untereiner & Sauber LLP who’s representing the investors. Stancil declined to name the companies. He helped represent hedge funds Aurelius Capital Management and Davidson Kempner Capital Management in their lawsuit against Argentina.

For Venezuelan President Nicolás Maduro, the easy part was winning a presidential race where the main opposition candidates were barred, their supporters boycotted the vote, and his government controlled every aspect of the contest, including counting votes, The Wall Street Journal reported. Now comes the hard part: Trying to pull his country out of the worst economic crisis in its history as it faces growing isolation from the international community. Mr.

The price of crude, long a bellwether for oil-rich, cash-poor Venezuela’s ability to repay debt, is anything but that these days. The correlation coefficient between oil and Venezuela’s benchmark 2027 bond is on the verge of turning negative for the first time since January, Bloomberg News reported. That’s happened only three times in the past decade, apart from the three months after President Nicolas Maduro called for a debt restructuring in November.

With Venezuela and its state-owned companies behind on $3.4 billion of bond payments, a group of creditors has joined together to consider their next steps and selected Millstein & Co. as financial adviser. The group will seek to evaluate the financial condition of Venezuela’s government and state oil producer Petroleos de Venezuela SA and “consider financing alternatives under an appropriate policy scenario,” according to a statement, which doesn’t detail which institutions are included in the committee or how much debt they hold, Bloomberg News reported.

If there is any smart money in Venezuela these days, it is probably in a $2.5bn, 8.5 per cent bond issued by PDVSA, the state oil company, due on October 27, 2020. Despite being declared in default, it trades around 85 cents on the dollar, suggesting investors believe they still have a good chance of getting paid, the Financial Times reported in a commentary. Compare that with a $650m 8.5 per cent bond issued by Elecar, a state electric utility, that matured on Tuesday, April 10.