2024-09-20 06:41:32
Ecuador’s country risk exceeded 1,400 points on Monday, June 24, 2024, due to a drop in oil production.
The temporary suspension of the Heavy Crude Oil Pipeline (OCP) was the main cause of this decline, as authorities decided to prevent possible damage from erosion of the Coca River, which threatened to break the pipeline.
The OCP outage forced state-owned Petroecuador to shut down several wells and declare a state of force majeure, reducing production to 30,000 barrels of oil per day.
This drop in oil production brought the country risk to 1,421 points, a significant increase compared to the 1,114 points recorded on May 7, which had been the lowest level in sixteen months.
This indicator measures the premium that Ecuador must pay to finance itself in international markets compared to the 10-year US sovereign bond.
Despite the initial drop, the latest report on Sunday, June 23, 2024 indicated a recovery, reaching production close to 490,000 barrels per day.
This increase in country risk occurs in a context in which the International Monetary Fund (IMF) has approved a new credit program of 4 billion dollars for Ecuador, with a term of 48 months for its disbursement.