Venezuelan President Hugo ChavezAmid economic downturn following the world financial crisis, Venezuela is losing billions of dollars in oil revenue to keep motorists happy. While Venezuela boasts the world's cheapest gasoline, ($0.14 per gallon), the steeply rising demand for gasoline and more than 43% rise in car sales is costing the country more than 9 billion dollars annually by conservative estimates. While consumption of oil for gasoline and energy production has increased, prices have remained the same, (approximately $8.18 per barrel compared to $96.12 for the same barrel overseas). Hugo Chavez, who is notorious for criticizing American energy demands, is faced with the dilemma of domestic consumption reducing profits. Chavez claims his administration will make natural-gas fueled cars available next year. However, in order to avoid deficits in the near future, Venezuela may have to reconsider its subsidized gasoline program and begin selling oil domestically at market prices.
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