The Jamaican dollar traded at a new record low on Monday after oil prices continued to plunge in international markets, leading to renewed speculation that Venezuela may be forced to terminate or restrict the supply of oil under the PetroCaribe initiative.
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In that event, Jamaica may need additional scarce foreign exchange if the nation is forced to buy crude oil or fuel products in international markets.
Oil dominates Venezuelan exports and the government is almost wholly reliant on oil for its foreign exchange. The South American nation may be forced to revise the PetroCaribe initiative after oil prices plunged more than 20% in the last three months and are down more than 35% for the year so far. Venezuela supplies oil to 17 regional nations under the initiative, which requires an upfront payment of only 50 percent and the rest paid over a span of several decades. According to the Bank of Jamaica website, the Jamaican dollar traded at an average buy rate against the US dollar of 113.13 and an average sell rate of 113.59. |
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