Caracas Chronicles

Oil at $21 per barrel, a looming credit event, goods shortages, very high inflation, political conflict…oh, and the place where most of our electricity comes from is drying up. Almost forgot that one.

We’re starting to find some stories about how low is the level of the Guri reservoir in the news. Expect many, many more in the months to come.

How bad is it? Have a look:

Those purple marks well below all the other lines, that’s 2016. It’s the worst it’s ever been. We’re even lower than in 2003, which was the previous record low.

According to the Guri manual, we should be rationing. And we probably are. But even with rationing, and even in the middle of a economic contraction that means weaker demand for electricity, the rate of decline (the slope) does not seem slower for 2016.

So what do you do then? Well, normally you balance the load using thermal power plants. Except we know who got those contracts. So more efficient consumption? Except power prices remain fixed, in nominal terms, with three-digit inflation.

So…we’re down to Plan D: praying for the rains to arrive in April. In an El Niño year.