The headquarters of state-owned Petroleos de Venezuela SA (PDVSA) in Caracas. PDVSA, once regarded as one of the world’s best oil companies, has become the government’s social-spending arm while investment in oil fields has lagged. (Meridith Kohut/Bloomberg News)

Five years ago, a full-page ad blasting Exxon Mobil appeared in the Venezuelan newspaper Ultimas Noticias. Drawings of drops of oil went from black at the top of the page to red at the bottom. “Exxon turns oil into blood,” the bold-face text declared. Addressing “Exxtranjero” — the Spanish word for foreigner, with an extra “x” — it used a slogan from the Spanish Civil War that roughly translates as “you will not pass.”

The ad summed up the combative relationship the late Venezuelan leader Hugo Chavez had with some international oil companies and how he used his country’s vast oil riches as a political tool and weapon. Abroad, he pushed for crude prices of $100 a barrel. At home, subsidies have kept fuel prices down around 8 cents a gallon.

“He’s a charmer. He’s a liar,” said one oil industry executive who knew Chavez, speaking on condition of anonymity to protect business relationships. “He’s done a lot to improve the lot of his people. He ruined the oil industry.”

Few analysts expect much change from his vice president and potential successor, Nicolas Maduro, who would need to bolster his domestic base.

The state oil company Petroleos de Venezuela SA (PDVSA), once regarded as one of the world’s best, has become the government’s ­social-spending arm while investment in oil fields has lagged. The year before Chavez became president, Venezuela’s oil production reached 3.5 million barrels a day. Then it slumped so badly that even after a modest recovery, it averaged only 2.5 million barrels a day last year.

Meanwhile PDVSA, even after purging thousands of experienced engineers and managers during a labor dispute, has grown to about 99,000 employees, according to a report from the Eurasia Group consulting firm. And half of its staggering $36 billion in debt is held by China.

“PDVSA is a shadow of its former self,” said David Goldwyn, a consultant and formerly the State Department’s special envoy and coordinator for international energy affairs under Hillary Rodham Clinton. “The refineries are [in] shambles. Fields are in decline. New investment is stagnant.”

Chavez also raised the state oil company’s share in production projects to 60 percent, and while most companies cut new deals, a couple, including Exxon Mobil, went to court.

Only historically high crude oil prices of about $100 a barrel have saved the country’s economy from ruin. Revenue stayed high even though the heavily subsidized domestic consumption has jumped 39 percent since 2001 and exports dropped by nearly half to 1.7 million barrels a day.

While condemning the United States and wooing countries such as Russia and Iran, Chavez still relied heavily on U.S. Gulf Coast refineries that were among the few capable of handling Venezuela’s thick, low-quality crude oil. About half of Venezuela’s crude ends up in the United States. But if the Keystone XL pipeline is built, similar-quality crude from Canada’s oil sands could push out Venezuelan petroleum.

“I think Chavez will be remembered for politicizing a once professional national oil company and managing to increase control but decrease production, miss the [liquefied natural gas] boom, and open the U.S. refining sector for Canadian oil,” Goldwyn said. Referring to Canada’s rival oil industry center, Goldwyn said, “He should be a hero in Calgary.”

Venezuela was a founding member of the Organization of the Petroleum Exporting Countries, and Chavez pushed for lower production and higher prices. But he wielded little power in the cartel, which is dominated by the Persian Gulf producers.

Venezuela's oil situation.

Chavez still used oil as a tool of his foreign policy.

“Venezuela is currently giving away around one third of its oil production at below-market prices, which together account for an estimated $20 billion in lost revenue per year,” said a report by the Eurasia Group, equal to 6.5 percent of gross domestic product.

The firm estimated that Venezuela shipped around 200,000 barrels a day to Caribbean and Central American countries in 2012 and 115,000 barrels a day to Cuba. In addition, Venezuela is sending more oil to China — about half a million barrels a day, according to the Eurasia Group — in part to meet its heavy interest payments on debt held by China.

Few analysts expect change in the Chavez oil policies soon.

“I doubt that the opening of the petroleum sector is in the cards, especially in the short term,” said Michael Shifter, president of the Inter-American Dialogue. “Maduro will have to tread carefully, and reforming PDVSA could risk support within Chavismo [the name given to Chavez’s political movement]. On the other hand, if the economic situation becomes completely untenable and Maduro eventually faces the choice of a greater opening or losing political control, he might opt for the former, however reluctantly.”

A report by Daniel Kerner, an analyst at the Eurasia Group, said, “Under a successor government, PDVSA would likely remain a key source of financing for the government’s social programs, infringing on its investment capacity.”

“A Maduro administration is unlikely to significantly alter any of these programs,” Kerner added. “In fact, in a context where the president would likely have lower political capital than Chavez and would likely face significant economic challenges, he would be even more reliant on maintaining such programs for his own political capital.”

Added Goldwyn, “It would take years to rebuild if the government were so inclined, but a change in course anytime soon is unlikely.”

Bernard Aronson, assistant secretary of state for inter-American affairs under Presidents George H.W. Bush and Bill Clinton, said: “Venezuela was a country that needed a social revolution. You had a condominium of two highly corrupt political parties that alternated power and sucked all the wealth out of the country.”

But, Aronson added, Chavez did not deliver the sort of social revolution needed, but instead left Venezuela with high inflation, declining oil output and corruption.

“The economy needs some reform and change. It is not going to get anywhere yoking its future to Iran,” Aronson said. “If Maduro and what’s left of Chavismo want to survive, they will have to make accommodations.”