On the 24th, powerful earthquakes of magnitude 7.2 and 7.5 struck the Caracas metropolitan area in Venezuela 40 seconds apart, and a new estimate says the country's economic loss from the disaster could reach up to 7% of gross domestic product (GDP).
A preliminary damage estimate released by the U.S. Geological Survey (USGS) on the 25th local time put the loss at between 1% and 7% of Venezuela's GDP. Applying the International Monetary Fund (IMF) estimate of Venezuela's 2026 GDP at about $111.3 billion, the loss would be between about $1.1 billion (about 1.7 trillion won) and $7.8 billion (about 12 trillion won).
The estimate is calculated by the USGS's automatic assessment system, the Prompt Assessment of Global Earthquakes for Response (PAGER), which derives damage ranges in about 20 to 30 minutes right after a quake. PAGER creates a map of shaking intensity by epicenter and magnitude, overlays it with population data to calculate the exposed population, then applies per-capita GDP and historical earthquake loss statistics to produce a loss range. Because the estimate relies on epicenter, magnitude, population density, and past cases, input errors carry through and widen the range in countries like Venezuela where statistical reliability is low. Rachel Ziemba, senior fellow for economics at the Center for a New American Security (CNAS), said on the 25th, "It looks like a reconstruction industry of considerable scale will be needed," and noted, "Additional adjustments may be needed regarding remaining economic sanctions to facilitate disaster-recovery remittances, capital inflows and outflows, and securing imported materials."
Of Venezuela's 31.7 million people, more than 20 million were already living in poverty before the quake, unable to secure sufficient food and medicine. Many hospitals lacked even stable running water or electricity. According to a living conditions survey released in 2023 by researchers at Andrés Bello Catholic University, about 10% of the population lived in housing without adequate safety even before the quake. The home sales market had virtually stalled amid rising prices and falling purchasing power.
The quake dealt another devastating blow to Venezuela's already-collapsed economy. Of the country's 31.7 million people, more than 20 million lived in poverty before the quake, unable to secure sufficient food and medicine. According to a living conditions survey released in 2023 by researchers at Andrés Bello Catholic University, about 10% of the population lived in unsafe housing even before the quake. Many of the buildings that collapsed this time were such vulnerable dwellings. South American outlets noted that poor housing conditions were cited as a main cause behind the collapse of more than 250 buildings and the displacement of more than 3,000 households.
Public functions that must support post-quake recovery are also precarious. Many hospitals are receiving the injured without even stable running water or electricity. The government has not released a single epidemiological report since 2016, leaving a shortage of data to gauge public health conditions. The Washington Office on Latin America (WOLA), a U.S.-based human rights group, said on social media, "Since 2016, Venezuela has experienced a collapse of public services amid a complex humanitarian crisis," adding, "After years of institutional dismantling and corruption, the state's capacity to respond to such a situation is severely limited."
Meanwhile, the government that would direct the quake response has been in office for less than half a year. On Jan. 3, the United States captured and jailed then-President Nicolás Maduro in a military operation, after which an interim presidency under Delcy Rodríguez took office. In the meantime, the United States has managed Venezuela's crude exports and pressed reforms in the nationalized energy and minerals institutional sector. With confusion from the change of power yet to subside, the worst earthquake on record struck the capital region, and the disaster response is expected to begin without a stable administrative base.
Local media and corporations said the quake's impact on Venezuela's core national industry, the oil institutional sector, appeared limited. According to El Nacional, the El Palito refinery in central Carabobo state, near the epicenter, did not sustain quake damage. The Morón petrochemical complex, the second largest in Venezuela, briefly halted operations after crude leaked from a storage tank right after the quake, then soon restarted. U.S. oil company Chevron told Al Jazeera that "facilities are operating normally." Shell and Repsol also confirmed all employees are safe. The Center for a New American Security said, "Since energy infrastructure does not appear to be heavily damaged, the human toll is likely to be greater than the economic damage," adding, "Even if U.S. sanctions limit capital inflows, most of Venezuela's fiscal revenue comes from oil."
Venezuela currently produces an average of 1.2 million barrels of crude a day. Although it holds the world's largest reserves at about 303 billion barrels, its actual production accounts for less than 1% of global output. Even within Venezuela, production stands at about one-third of its 1970s peak, when it pumped 3.5 million barrels a day. A long slide in output stems from corruption, underinvestment, and U.S. sanctions.
The United States, which has been working to improve ties with Venezuela since Maduro's arrest, promised large-scale aid right after the quake. U.S. Secretary of State Marco Rubio told reporters in Bahrain right after the quake, "The United States has deployed a rescue operation, and it will be clearer within 48 hours what is needed." The U.S. government pledged $150 million (about 232 billion won) in humanitarian aid. Separately, Interim President Rodríguez said, "We will use a $200 million (about 309 billion won) facility from the International Monetary Fund (IMF) to rebuild infrastructure, hospitals, and housing." Even combined, the two sums are close to an initial response compared with the GDP loss estimate and at least 3,000 displaced households and more than 250 collapsed buildings. In addition, neighboring Brazil sent a search team including 36 firefighters and 9 tons of equipment, and Switzerland provided 18 tons of rescue equipment to ease the burden on local authorities. The United Nations has begun a full-scale humanitarian response.
Venezuela sits on a seismic belt where the Caribbean Plate meets the South American Plate and is vulnerable to shallow quakes with focal depths under 20 kilometers. Shallow quakes occur close to the surface and produce stronger shaking and greater damage for the same magnitude. According to the USGS, the quake struck on the afternoon of the 24th near San Felipe, about 284 kilometers west of Caracas. The first magnitude 7.2 quake hit at 6:04 p.m. on the 24th, followed 40 seconds later by a magnitude 7.5 quake near Yumare, about 293 kilometers away. It is the strongest quake to hit Venezuela since a magnitude 6.6 quake in 1967 killed up to 300 people. The epicenters were close to densely populated areas, including the capital, Caracas, amplifying the damage. USGS geophysicist William Yeck said, "It's not the shaking that kills people, it's buildings," adding that "Venezuela has many unretrofitted masonry buildings, making it more vulnerable to earthquake damage than California or Japan."