Colombian oil sector union suspends strike

Despite voting earlier this month to go on strike at any point after March 26^th, the USO, the main Colombian oil workers’ union, changed course and suspended the planned strike. USO President Edwin Castaño said, “We have decided to suspend the indefinite strike for now. We trust the government will resolve the problems confronting the oil sector.”

Reuters explained that the strike had been planned to protest job cuts in the Colombian oil sector and to act on fears that the government would sell some of its 88% stake in Colombian state oil company Ecopetrol. However, Ecopetrol reassured USO leaders that the government has no intention of privatizing Ecopetrol, and pointed out that the oil company has yet to cut any jobs, but instead has simply stopped hiring new employees. According to Reuters, all of the job losses that have occurred so far have been among outside contractors involved in construction projects.

On Wednesday, the Colombian business journal Portafolio published an editorial exploring the question of whether or not Colombia is an “oil country.”  The author explains that the oil sector makes up a small portion of Colombia’s economy and employment, especially when compared to traditional “oil countries.” Nonetheless, the oil industry generates 25% of the Central Government’s revenue. The author concludes that Colombia does not have an oil economy, just oil spending. He encourages Colombia to accept the fact that it is not an oil country and focus its energy on being productive and competitive in other sectors of the economy.

In other oil-related news, Portafolio discussed the specter of a possible return for Colombia to being an oil importer, while El Tiempo commented on a report that the Orca 1 oil discovery in the Colombian Guajira was the biggest oil discovery in Latin America in 2014. These contrasting visions of the future of the Colombian oil industry imply that there is more oil to be found in the country, but the key will be encouraging companies to maintain their investment in exploration.