Venezuela is calling for an emergency meeting of the Organization of the Petroleum Exporting Countries (OPEC) as slumping oil revenues and a deep cash crunch stoke fears that the country could default.
With oil prices diving to their lowest levels since 2010, OPEC countries have begun undercutting each other to hold onto their market shares.
Saudi Arabia, Iraq and Iran are all selling crude to buyers in Asia at a discount, the Financial Times said.
Venezuela has made an emergency appeal to OPEC, calling on the group to pinpoint the cause of the price slide and find a solution.
Saudi Arabia, OPEC’s largest producer, has made it clear it can manage with the lower prices and has no intention of easing back production.
“We are in a price war,” PDVSA chief Eulogio del Pino said.
Weak oil prices come at a bad time for Venezuela as it faces a wave of maturing debt during the next two years while its deals with dwindling cash reserves and supply shortages.
PDVSA was also ordered by the World Bank to pay $1.6 billion to ExxonMobil for assets the country seized in 2007 after the nationalization of heavy crude projects.
Oil exports account for about 95 percent of all Venezuelan exports.
Concerns that falling oil revenues could further strain Venezuela’s coffers sent yields on the country’s bond up to 16 percent, currently the highest yield for any sovereign country.
Venezuela has been suppressing its official GDP data so the exact state of its economy remains difficult to gauge.
A report published Tuesday by the Paris-based International Energy Agency slashed its global demand growth forecast by 22 percent as consumption slows and production continues to climb.
OPEC is scheduled to meet on November 27.