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Why Venezuela's oil production plunged to a 13-year low

Coca-Cola halts production in Venezuela

Crisis-stricken Venezuela has another big problem: its oil production has plunged to alarmingly-low levels.

At a time when most OPEC countries are ramping up oil output, Venezuela produced just 2.15 million barrels of crude oil per day in June, according to S&P Global Platts estimates. That's the weakest pace since February 2003, Platts said.

Venezuela's shrinking oil production is a reflection of the country's grim financial situation, which has caused rolling blackouts that have even left oil facilities in the dark. And because of how critical oil is to Venezuela's economy -- oil accounts for 96% of exports -- the declines threaten to exacerbate the already-dire situation, where a severe food shortage has led to waves of looting.

"It's coming together now in a perfect storm," said Thomas O'Donnell, a senior energy analyst at Wikistrat.

An internal report by PDVSA, Venezuela's state-owned and scandal-plagued oil giant, also showed a "steep fall" in oil output, Platts said.

OPEC numbers released on Tuesday paint a similar story. The oil cartel estimates Venezuela's production fell to 2.1 million barrels per day in June, making it...