Saturday, January 10, 2009

Venezuela denies OPEC production cuts prompted 4,000 layoffs

Venezuela's state oil company has denied 4,000 contract workers have been laid off as the nation moves to comply with new OPEC production cuts.
State oil company Petroleos de Venezuela, SA, or PDVSA, dismissed reports that at least eight oil rigs have been halted and thousands of contract workers laid off. Vice President Eulogio Del Pino said in a statement that union leaders who made the allegations were lying for political reasons. He said PDVSA is reviewing whether to renew a contract that terminated automatically on December 28, affecting three oil rigs. He said the negotiation of this and other contracts is based on service companies' needs to reduce costs as oil prices fall.

Union leader Rafael Zambrano says 3,000 to 4,000 contract workers had been dismissed as PDVSA moved to reduce production by 189,000 barrels per day. Opposition-aligned union leader Froilan Barrios also confirmed the layoffs. The Organization of Petroleum Exporting Countries has reduced production by 4.2 million barrels per day since September in a move to boost prices.

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