Wall Street Journal: Venezuelan Bonds Retreat After Government Falls Behind Again on Debt Payments

Venezuela owes a total of $4.4 billion that is due over the next three weeks, including the payments due this week, an amount that many analysts believe could drain the country’s dwindling foreign-reserve holdings.

“It seems they’re saving every penny for these two big payments,” said Russ Dallen, managing partner at Caracas Capital.


Miami Herald: Maduro faces financial nightmare in Venezuela — just in time for Halloween

“The truly hellish week will come around Halloween, the 27th, when they basically have to pay $1 billion and then Nov. 2, when they will have to pay another $1.2 billion,” said Russ Dallen, managing partner at Caracas Capital.


The government has averted default in recent months because of timely loans from the Russian government, which so far has always seemed ready to provide the millions of dollars needed by its foundering Latin American ally.

But Dallen said he was not sure whether the Russians would be willing to come to the rescue again.

“The Russians are not very happy,” Dallen said, noting a report in June that Venezuela had failed to make a $1 billion payment due to Moscow.

One billion dollars may not look like much in the United States, but it’s a lot for Russia, said Dallen, who often consults with Washington officials on Venezuelan affairs.

The Russians may well be approaching the point of concluding that continuing to invest in Venezuela is too risky, he added.


Barron’s: OPEC Eyes U.S. Frackers as Venezuela Oil Rigs Hit Low

Russ Dallen, a lawyer, publisher and the managing partner of Caracas Capital, notes today that U.S. energy services companies are keeping a presence in Venezuela despite U.S. government sanctions, given the investment needed to tap Venezuela’s bountiful oil reserves. He writes:

“Last year with great fanfare, the Venezuelan government announced billions of dollars of new investments in its oil industry to increase production, from Halliburton (HAL), Schlumberger (SLB) and a small, unknown U.S. company known as Horizontal Well Drillers, based out of Oklahoma. As the drilling data above shows, those investments do not seem to have been forthcoming and the number of active drills continues to fall. One of the reasons is that PDVSA is not paying its debts. … Venezuela’s unpaid $636 million debt to Halliburton does not include $200 million in Promissory Notes that Halliburton swapped into PDVSA Promissory Notes in 2016. Likewise, Schlumberger is owed even more by PDVSA according to Schlumberger’s 1Q2017 financials – $1.2 billion. Schlumberger then swapped $700 million of that debt into new 2017 issue PDVSA Promissory Notes during the 2nd Quarter of 2017. … By the way, both the 2016 and 2017 issue PDVSA Promissory Notes are 3 year amortizing financing deals that total over $2 billion and would seem to fall afoul of some parts of the U.S. Government’s August O.F.A.C. sanctions on financing PDVSA. … So, it was with much bemusement that we noticed 2 gringos from a small Oklahoma outfit named Horizontal Well Drillers being trotted out live on Venezuelan TV signing a contract to invest in a $3.2 billion drilling project. It turns out that the firm doesn’t have much capital …”


El Nuevo Herald: Venezuela – Finanzas de pesadilla para Maduro: se vencen plazos y no sabe de dónde sacar dinero

“La verdadera semana infernal se producirá cerca de Halloween, para el 27 [de octubre], cuando deben pagar básicamente $1,000 millones, y luego el 2 de noviembre, cuando tendrán que pagar otros $1,200 millones”, dijo desde Miami Russ Dallen, socio gerente de la firma Caracas Capital.


Pero Dallen dijo que no está muy seguro de que los rusos estén dispuestos a hacerlo nuevamente en los próximos días.

“Los rusos no están muy contentos”, dijo Dallen, al resaltar que Venezuela incumplió el pago de más de $1,000 millones en obligaciones contraídas con Rusia, en una información que fue divulgada en junio.

Es posible que $1,000 millones sea relativamente poco dinero en Estados Unidos, pero es mucho en Rusia, dijo Dallen, a quien las autoridades en Washington consultan con frecuencia sobre asuntos venezolanos.


Secure Freedom Radio: Russ Dallen on Venezuela, Russia and Oil Production

RUSS DALLEN, President & Editor in Chief at The Latin American Herald Tribune, Head of the international investment bank, Caracas Capital Markets, Served as President of Venezuela’s “The Daily Journal”:

  • Russia’s willingness to prop up Maduro regime
  • Venezuela’s sharp decline in oil production


Miami Herald: Trump team waiting for Russia to save Venezuela from crushing debt

Bloomberg: PetroChina Americas Is Said to Review Venezuela Oil-for-Loans

While these types of transactions are common in the oil industry and have helped finance production from Iran to Brazil, the new U.S. sanctions against the government of Venezuelan President Nicolas Maduro may change the playing field. A $2 million fine levied against Exxon Mobil Corp. in July for violating sanctions against Russia have made oil companies wary, according to Russ Dallen, a managing partner at Caracas Capital Markets.

“The sanctions didn’t appear to be much at a first look, but they are actually very harmful,” Dallen said in a telephone interview from New York. “After what happened to Exxon, everyone thinks twice before signing anything with Maduro or PDVSA’s money man Simon Zerpa.”



Barron’s: Venezuela ‘Has & Will Have’ Cash, Makes $185M Debt Payment

Of course, it’s not clear if the government’s future tense meant that it would have the resources today, or until the end of time. Investor, lawyer and publisher Russ Dallen at Caracas Capital, who has his finger on Venezuela’s financial pulse, is more apt to believe the former. He wrote in an email this evening that his instigation via Reuters and Bloomberg coverage, has “caused Venezuela to be embarrassed and finally hustle to get the bond paid today.”


PetroChina pidió a su sede en EE UU no aprobar préstamos a Pdvsa

Si bien este tipo de transacciones son comunes en la industria petrolera y han ayudado a financiar la producción de Irán a Brasil, las nuevas sanciones estadounidenses contra el gobierno de Nicolás Maduro pueden cambiar el campo de juego. Una multa de 2 millones de dólares impuesta a Exxon Mobil Corp en julio por violar las sanciones contra Rusia ha hecho que las compañías petroleras se cuiden, según Russ Dallen, socio gerente de Caracas Capital Markets.

“Las sanciones no parecieron ser muy importantes, pero en realidad son muy dañinas”, dijo Dallen en una entrevista telefónica desde Nuevo York. “Después de lo que pasó con Exxon, todo el mundo piensa dos veces antes de firmar algo con Maduro o el hombre de dinero de Pdvsa, Simón Zerpa”, expresó Dallen.












Financial Times: Moscow seeks to extend influence in US back yard

Caracas desperately needs cash. In the remaining four months of this year, $4.2bn in payments for sovereign debt and bonds of PDVSA will come due. The state-owned oil company has to repay $1.28bn in October and $1.71bn in November alone, according to Caracas Capital Markets. The country has less than $10bn in foreign reserves.




El Nuevo Herald: Deuda de Venezuela comienza a tornarse tóxica a una semana de las sanciones de Trump

“Se está tornando cada vez más difícil hacer negocios con instrumentos de Venezuela. Los precios de los bonos, los flujos y los volúmenes de operaciones con esos bonos se están extinguiendo porque todo el mundo está temiendo un próximo anuncio”, dijo desde Miami Russ Dallen, socio gerente de Caracas Capital Markets, quien es una de las voces más escuchadas por la Casa Blanca y el Congreso de Estados Unidos.

“Se están convirtiendo en una papa caliente, y nadie quiere ser el último que se quede con ellos”, agregó.


En teoría parte de esos fondos podrían ser usados para cumplir con las obligaciones de deuda que aún quedan este año, pero la mayor parte de ese total se encuentra en barras de oro, y éstas tendrían que estar siendo vendidas en este momento para poder contar los recursos necesarios en los próximos tres meses.

Dallen dijo que hasta ahora no ha visto señales en los mercados de que eso esté sucediendo.








Bloomberg: Maduro’s Come-to-Caracas Invite Has a Few Investors Saying Yes

“The most important positive takeaway that investors usually come away with after meeting officials is that Venezuela and PDVSA intend to pay,” said Russ Dallen, a managing partner at Caracas Capital Markets. The “negative takeaway is usually that a minister or functionary’s explanations of just how that payment is going to happen are improbable, unrealistic or unexplained.”


Los inversores aceptan visitar a Maduro en Caracas porque no se fían de que vaya a pagar la deuda

“El mensaje positivo más importante que se llevan normalmente los inversores después de reunirse con funcionarios es que Venezuela y PDVSA tienen la intención de pagar”, dijo Russ Dallen, socio gerente de Caracas Capital Markets. El “mensaje negativo es, en general, que las explicaciones de un ministro o funcionario sobre cómo se producirá ese pago son improbables, poco realistas o sin justificación”.


Bloomberg: Alguns investidores aceitam convite de Maduro para ir a Caracas

“O resultado positivo mais importante que os investidores costumam trazer depois de se reunir com as autoridades é que a Venezuela e a PDVSA pretendem pagar”, disse Russ Dallen, sócio administrativo da Caracas Capital Markets. O “resultado negativo geralmente é que as explicações de um ministro ou assessor sobre como esse pagamento vai acontecer são improváveis, irrealistas ou inexplicáveis.”


New York Times: US Sanctions to Pile Misery on Moribund Venezuelan Economy

“This could really reduce them to a barter economy and throw Venezuela back to the stone
ages,” said Russ Dallen, a managing partner at investment bank Caracas Capital Markets. “It’s
both fascinating and terrifying to watch.”


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