As the slump in oil prices pushes Venezuela's economy closer to a depression, ordinary Venezuelans are finding it difficult to buy the basic food items. According to media reports, more than 100,000 Venezuelans crossed into Colombia over the weekend to hunt for food and medicine.
Estimates released by the International Monetary Fund in April suggested inflation in Venezuela is projected to increase 481% this year and by a staggering 1,642% next year.
Ever since a nosedive in oil prices began, Venezuela, which depends on oil exports to support its economy, has witnessed alarming scarcity of food. The country has witnessed triple-digit inflation, highest in the world.
Over the last weekend, the government allowed crossings for 14 hours to let people buy basic goods amid chronic shortages in the country.
In May, the Indian government offered oil-for-drugs deal with Venezuela to recover money for various pharmaceutical companies. India's second-largest pharma company Dr Reddy's Laboratories Ltd wrote off $65 million in the March quarter, which it said was almost all the money that was owed from cash-strapped Venezuela.
The International Energy Agency reported Venezuelan crude production at 13-year low last month as slump in global crude prices has teetered its economy on the brink of a debt default.
Chronic shortage of basic necessities has also fuelled social unrest in oil dependent state. There have been reports of looting and protests. The debt ridden country has witnessed long lines outside supermarkets in recent weeks.
According to a World Bank report, oil accounts for 96 percent of Venezuela's exports. The International Energy Agency reported Venezuelan crude production at 13-year low last month as slump in global crude prices continues to mar its tattered economy.
In its efforts to avoid a sovereign default which could further stop financial aid for its stressed oil industry, the embattled socialist government of Nicolás Maduro has further tightened currency controls introduced by Hugo Chávez in 2003. Venezuela's currency, the Bolivar, has been devalued more than any other country.
Tighter currency controls have made it difficult for multi-national companies to convert local currency into dollars. As a result several international airlines, who charge in local currencies have shut their operations in the beleaguered country.