OREANDA-NEWS. Venezuelan president Nicolas Maduro would gain sweeping new powers under a controversial 14 January decree that establishes a 60-day state of national economic emergency.

Maduro publicly declared the state of emergency, renewable for a further 60 days, on 15 January, hours before he was scheduled to deliver a constitutionally mandated annual report to the new opposition-controlled national assembly. But the full text of the decree was not released until after his vitriolic three-hour speech in which he reiterated that Venezuela is the victim of an "economic war" waged from abroad.

Armed with the new decree, Maduro would have the power to expropriate privately owned assets, award bid-free contracts, re-allocate productive and financial resources, and restrict individual bank withdrawals.

With Venezuela?s current oil export basket at a 12-year low and approaching the cost of oil production, it is not clear what economic options Maduro could take without compromising his political stance or defaulting on foreign debt.

Jos? Guerra, a former central bank economist and current opposition lawmaker, says the decree "gives the government discretion to spend…it could mean expropriations of production lines, companies, and no one will have control over his money."

The assembly has up to eight days from the decree's 14 January publication in the official gazette to approve it, but if it is rejected Maduro could appeal to the supreme court, a constitutional lawyer with the attorney general's office tells Argus.

In one of its final acts, the previous government-controlled assembly packed the high court with sympathizers.

National assembly president and opposition leader Henry Ramos Allup has yet to comment on the decree. But he pledged on 5 January when he took up the gavel that Maduro would "never" be granted special powers to rule by decree and sidestep the legislature and courts. Maduro and his predecessor Hugo Chavez routinely ruled by decree, with a rubber stamp from the assembly.

The average price of state-owned PdV's oil exports dropped below $25/bl on 15 January, less than $5/bl above its average production cost of $20/bl reported by the energy ministry.

Energy minister and PdV chief executive Eulogio del Pino cautioned on 15 January that Venezuela's oil price will likely weaken further in first quarter 2016 barring urgent joint actions by Opec and non-Opec producers.

Coinciding with Maduro?s speech, the central bank issued some official macroeconomic data for the first time since Maduro ordered their publication suspended in September 2014. According to the official data, Venezuela's GDP shrank by 7.1pc in third quarter 2015, compared with a 2.7pc contraction in third quarter 2014. The economy fell by 4.5pc in the first nine months of 2015, the bank's report added. This figure contrasts with data released unofficially by central bank economists in December indicating that GDP shrank by up to 10pc in January-September 2015.

Cumulative inflation during the first nine months of 2015 was 108.7pc, with a third quarter price surge of 39pc doubling first quarter inflation of 19.1pc, the bank said. Annual inflation measured from September 2014 to September 2015 was 141.5pc. Internal bank estimates put the figure at more than 250pc for full-year 2015.

Venezuela's net foreign debt exposure at end-September 2015 was $148.8bn, the bank said, without specifying how much the government and PdV owe separately. Del Pino said the company is studying ways to refinance over $5.2bn of debt principal and interest that matures in 2016.

The central bank's report acknowledges critical shortages resulting from a sharp drop in non-oil imports because of lower oil prices and lower national production. But the bank asserts that 87pc of perceived shortages stem from hoarding of goods by private producers and wholesalers, reiterating an official interpretation of the crisis.