Summary
Venezuela is an example of a decaying petrostate, where the government is highly dependent on income from fossil fuels, power is concentrated in an elite minority, and corruption is widespread.
Petrostates are vulnerable to what economists call Dutch disease, a dynamic in which a government develops an unhealthy dependence on natural resource exports, and other important industrial sectors are deprived of investment.
Venezuela has descended into economic and political turmoil under President Nicolas Maduro, as its once-substantial oil outflows have slowed to a trickle. Absent a power transition, analysts say the country’s prospects are grim.