Venezuela Announces Financing From Qatari Banks As Oil Prices Continue To Fall

Venezuelan President Nicolás Maduro this week announced another financial lifeline for his struggling economy -- this time from Qatar. Speaking during his trip to Doha, Maduro said his government was securing “several billion dollars” from Qatari banks to help Venezuela muddle through its cash shortfall in the wake of falling oil prices.

“We are finalizing a financial alliance with banks from Qatar that will give us sufficient oxygen to help cover the fall in oil prices and give us the resources we need for the national foreign currency budget,” Maduro said Monday following a meeting with Emir Sheikh Tamim bin Hamad Al Thani. Maduro said he was working to secure financing “not just for 2015, but also for 2016.”

Maduro is in the middle of an international tour that observers have interpreted as a bid for financial assistance as the price of oil, which has fallen by 60 percent since June 2014, has caused Venezuela’s foreign reserves to dwindle. Maduro visited China last week, where he secured $20 billion worth of investments for energy and social projects, and he has made his way through OPEC-member countries to lobby for an oil production cut to stem the trajectory of oil prices. Maduro completed trips through Qatar, Iran and Saudi Arabia, and is in Algeria Tuesday. OPEC, meanwhile, has remained steadfast in its decision not to cut production. Crude slipped below $45 a barrel Tuesday afternoon.

The president didn’t specify many of the Qatari agreements in detail, but he did announce that direct flights would begin between Doha and Caracas. He also said Venezuela and Qatar would be forging a partnership to export food to the Middle Eastern country. “Qatar has a special fund to invest in food production,” he said, according to state-run media outlet Telesur. “We produce for ourselves and would like to provide the food Qatar needs.”

The comment provoked ire among members of Venezuela’s opposition, particularly as long grocery lines and rampant shortages of food and other household items hit a crisis point over the weekend. State security forces were deployed to several grocery stores on Saturday to prevent the escalation of protests. “Now he says he will produce food to export to Qatar when he doesn’t even know how to produce here,” tweeted Henrique Capriles, opposition leader and Maduro’s former opponent for the presidency, on Monday. Capriles also said that the investments secured fell short of loans Maduro had hoped for to get immediate relief from the country's financial crisis.

"Nicolás and his group is going around touring," Capriles said, according to the Wall Street Journal. "They went looking for money in China and didn't get it. Now they're going around OPEC countries where they're being told that the oil bonanza will not be back."

It’s still unclear what Qatari banks were in talks over the deal, or exactly how much money was involved in the new investments. Qatar has remained silent on the agreement.

Meanwhile, Moody’s ratings agency cut Venezuela’s debt rating on Tuesday from Caa-1 to Caa-3, indicating a “marked increase” in Caracas’ default risk.