Venezuela

Venezuela’s debt crisis passed a new milestone as the government missed a principal payment on one of its bonds for the first time this week, boosting arrears on international securities to $6.1 billion, Bloomberg News reported. It was hardly a surprise for investors, who have watched the value of their securities plummet since President Nicolas Maduro announced in November that he would seek to restructure the country’s debt in the midst of an economic crisis.

Venezuela's president Nicolas Maduro announced on Friday a single exchange rate pegged to his socialist government’s petro cryptocurrency, effectively devaluing by 96 percent in a move economists said would fan hyperinflation in the chaotic country, the International New York Times reported on a Reuters story. In one of the biggest economic overhauls of Maduro's five-year government, the former bus driver and union leader also said he would hike the minimum wage by over 3,000 percent, boost the corporate tax rate, and increase highly-subsidized gas prices in coming weeks.

As Venezuela and its state-owned oil firm PDVSA lurch from crisis to crisis, defaulted creditors are jockeying for position to ensure they are among the first to receive cash when payday eventually comes, the Financial Times reported. The Opec country is essentially bankrupt and creditors are increasingly chasing its oil assets with their biggest target being Citgo, the Houston-based oil refiner that processes Venezuelan crude oil and is estimated to be worth roughly $4bn. Next in their sights is seizing Venezuelan oil cargoes at sea, as US hedge fund Elliott Management did

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.