Venezuela Requests Emergency Meeting with Fellow OPEC Producers as Oil Prices Collapse

Venezuela has requested an emergency meeting with its fellow OPEC producers amid collapsing oil prices.

According to five people privy with the issue, the South American nation's letter was sent to the 12 other members of the Organization of Petroleum Exporting Countries, or OPEC, Bloomberg reported. The letter said that the slump in oil prices is causing serious repercussions on the group's most vulnerable members.

Venezuela belongs to OPEC's Fragile Five members, which also includes Algeria, Iraq, Libya, and Nigeria, Bloomberg reported from RBC Capital Markets LLC.

Venezuela has continually requested a meeting with OPEC members as falling oil prices weakens government revenue, the news outlet added. Saudi Arabia, OPEC's de facto leader, has said that it won't cut production unless non-OPEC exporters cooperate. On Jan. 17, Saudi Arabia made it known that it will maintain defending market share.

"It is not the first time and probably not the last time Venezuela will ask for an emergency meeting," Giovanni Staunovo, an analyst at UBS Group AG, said via an e-mail quoted by Bloomberg. He added that while "an extraordinary meeting would just make sense if OPEC is willing to cut," cooperation from non-OPEC nations is a requirement if Saudi Arabia were to control oil supply, the news outlet noted.

Three OPEC delegates said that an emergency meeting needs approval from all member nations, Bloomberg reported. Saudi Arabia and its Gulf allies are not likely to support an unscheduled meeting.

The price of 13 crudes from OPEC countries weakened at $23.85 a barrel on Tuesday, an almost 80 percent decline since 2014 began, Bloomberg noted. According to Reuters, that price is OPEC's lowest since 2003, and could worsen this year due to the removal of sanctions on Iran.

An OPEC delegate said that "there is no change in the Gulf coun‎tries' position with their market share strategy," the news outlet reported. The next OPEC meeting is scheduled in June.

"Also none of the non-OPEC (countries) show they are willing to cooperate with OPEC for a cut. Iran also still didn't add (extra) oil to the market. So things didn't change," the delegate added, as quoted by Reuters.

Last week, Venezuelan President Nicolás Maduro declared a 60-day economic emergency to address the country's worsening crisis, BBC reported. If the National Assembly passes the decree, it would give Maduro broader powers to interfere in companies or limit access to currency. It could also increase taxes and impose emergency measures to pay for welfare services and food imports.