Petrocaribe facts for kids
| Public | |
| Industry | Oil |
| Founded | June 2005 |
| Headquarters | ? |
| Products | Oil |
| Revenue |  USD/$ ? billion (2006) |
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Operating income
|
USD/$ ? billion (2006) |
 USD/$ ? billion (2006) |
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| Parent | PDVSA |
Petrocaribe was a special agreement for oil between Venezuela and many countries in the Caribbean. It was started on June 29, 2005, in Puerto La Cruz, Venezuela. This happened when Hugo Chavez was president of Venezuela.
Under Petrocaribe, Venezuela offered oil to these countries with a very helpful financial deal. This agreement was part of a bigger idea in Latin America to help countries grow in new ways. In 2013, Petrocaribe also connected with the Bolivarian Alliance for the Americas (ALBA). This was to do more than just trade oil; it was about working together on economic projects.
By 2019, the deal mostly stopped working. This was because Venezuela's oil production went down. Also, there were problems with corruption and changing oil prices.
However, in November 2022, Saint Vincent and the Grenadines became the first country to start getting oil again under the Petrocaribe rules. In 2023, Venezuela said it wanted to bring the program back to life.
Contents
How the Oil Deal Worked
This agreement was created to show support and friendship with other countries. It grew from an earlier agreement called the Caracas Accord.
The payment system was very flexible. Countries could buy oil at its regular price but only had to pay 5% to 50% upfront. They also got a grace period of one to two years before paying more. The rest of the money could be paid over 17 to 25 years. The interest rate was very low, just 1%, if oil prices were above US$40 per barrel.
This deal was built on ideas from other agreements like the San José Agreement. Rafael Ramírez, who was in charge of energy and oil for Venezuela, said the goal was to remove the "middleman." This meant countries could get oil directly from Venezuela.
Countries That Joined Petrocaribe
Petrocaribe had 18 members in total. These included:
- Antigua and Barbuda
- Bahamas
- Belize
- Cuba
- Dominica
- Dominican Republic
- Grenada
- Guatemala
- Guyana
- Haiti
- Honduras
- Jamaica
- Nicaragua
- Saint Kitts and Nevis
- Saint Vincent and Grenadines
- Saint Lucia
- Suriname
- Venezuela
Twelve of these countries were also part of the Caribbean Community (CARICOM). When Petrocaribe first started, 14 countries joined. Later, Haiti and Nicaragua became members.
Guatemala joined in July 2008. But they left in November 2013. They said Venezuela did not give them the very low financing rates they were promised.
Haiti was not invited to the first talks. This was because Venezuela did not recognize its government at the time. However, Hugo Chávez worked to build a good relationship with Haiti's new president, René Préval, in 2006. After Venezuela helped Haiti with its buildings and roads, Haiti received its first oil shipment in March 2008.
Honduras joined in December 2007. They left after a change in government in 2009. But they rejoined the group in May 2012. Belize created a company called the Belize Petroleum Energy Company to help with the Petrocaribe project.
Countries That Did Not Join
Barbados said it did not join because of pressure from the United States. The U.S. and Venezuela had a difficult relationship. However, Barbados has not said no to joining Petrocaribe in the future. In 2011, Hugo Chávez again offered Barbados a chance to join.
Panama asked to join in March 2009. They initially said they would join under their new president. But Panama is still not a member.
Meetings of Petrocaribe Members
The first meeting, which started the project, was held in Puerto La Cruz, Venezuela. The second meeting took place in Montego Bay, Jamaica. The third meeting was in Caracas, Venezuela. The fourth meeting was in Cienfuegos, Cuba, in December 2007.
The seventh meeting was held in Caracas on April 6, 2013. At this meeting, Honduras rejoined the group. Guatemala also officially became a new member. The meeting also discussed working more closely with ALBA countries. They talked about tourism, air travel, and making sure there was enough food for everyone. The 11th meeting was held in Port-au-Prince, Haiti.
What Happened Recently
By 2019, Petrocaribe had mostly stopped working. This was because Venezuela was producing much less oil. Also, the country's oil industry was in trouble. In 2014, Venezuela produced almost 3 million barrels of oil a day. Now, it produces less than a million barrels a day.
Also, the U.S. put rules on Venezuela that made it hard to send money to the country. This made it very difficult for other countries to pay for oil.
The only country still getting oil from Venezuela with special prices is Cuba. Cuba does not have debt problems because it agreed to pay for its oil by sending doctors to Venezuela.
In 2022, Saint Vincent and the Grenadines received oil from Venezuela under the Petrocaribe agreement. This made them the first country to restart ties. In 2023, Venezuela announced it wanted to bring Petrocaribe back. In July 2023, CARICOM members asked the U.S. to remove its rules on Venezuela. This would allow them to buy oil under the good terms of Petrocaribe again.
See also
- SUCRE (currency)
- History of Venezuelan Oil Industry
- Petróleos de Venezuela, S.A.
