Macroeconomic Stabilization Fund - FEM

DEFINITION of 'Macroeconomic Stabilization Fund - FEM'

A reserve fund established by the country of Venezuela. Also known as the "FEM," it was created at the behest of the IMF to stabilize the national cash flow generated from oil production. It receives all monies generated from oil production above a certain price per barrel and pays out the difference if the price falls below this level.

BREAKING DOWN 'Macroeconomic Stabilization Fund - FEM'

The price per barrel above which revenue is diverted into the fund is based on the average price of oil over the past five years. Oil price fluctuations are hedged with future contracts on an as needed basis.


The fund is governed by the Board of the Central Bank of Venezuela.

RELATED TERMS
  1. Price Per Flowing Barrel

    A metric used to determine the value of a oil and gas company. ...
  2. Barrels Per Day - B/D

    A measure of oil output, represented by the number of barrels ...
  3. Oil Reserves

    An estimate of the amount of crude oil located in a particular ...
  4. Barrels Of Oil Equivalent Per Day ...

    A term that is used often in conjunction with the production ...
  5. Initial Production

    The measurement of an oil well's production at the outset. Initial ...
  6. Oil Stabilization Fund (Iran)

    A government-controlled sovereign wealth fund managed for the ...
Related Articles
  1. Economics

    Venezuela Teeters On Edge As Oil Revenues Shrink

    Low oil prices have drastically revised the economic status quo -- dealing a destabilizing blow to oil-exporters like Venezuela due to falling oil revenue.
  2. Investing

    Can a Venezuela Revolt Impact Oil Prices?

    How a social crisis in Venezuela could affect West Texas Intermediate crude oil and Brent crude oil prices.
  3. Economics

    Oil Is Cheaper Than Bread In Venezuela...The Country Is In Chaos (BAC, TAPR)

    Venezuela is floundering, and the story has more to do with just the falling price of oil.
  4. Options & Futures

    Falling Oil Prices Could Bankrupt These Countries

    The price of crude oil has fallen sharply as of late, trading around $45 per barrel down from a high of over $100 just six months ago. Many oil-producing countries are feeling the pinch as oil ...
  5. Economics

    The Biggest Oil Producers in Latin America

    Find out which countries produce the most oil in Latin America, and learn about some of the biggest oil companies operating in each country.
  6. Active Trading

    How Does Crude Oil Affect Gas Prices?

    Find out how this commodity's fluctuating price affects more than just how much you pay at the pump.
  7. Investing

    Venezuela Economics: 4 Reasons Why This Country May Go Under

    Find out the reasons behind Venezuela's economic woes and why many economists believe it is headed for collapse in the coming year.
  8. Investing

    Who is Most Affected by Lower Oil Prices?

    With low oil prices affecting just about everyone, from citizens to corporations to entire nations, we look at who wins and who loses with the price drop.
  9. Investing

    How Oil Will React To A Revolution In Venezuela

    The downward trend of the price of oil over the past year is having devastating consequences for the Venezuelan economy, causing political unrest and increased opposition to the socialist Maduro ...
  10. Stock Analysis

    The Biggest Oil Producers in Asia

    Learn which Asian countries deliver the most crude oil to market, and discover what companies are the biggest producers in each country.
RELATED FAQS
  1. How does the price of oil affect Venezuela's economy?

    Learn how the price of oil has a direct relationship with Venezuela's economy. High oil prices result in good times for the ... Read Answer >>
  2. What causes oil prices to fluctuate?

    Discover how OPEC, demand and supply, natural disasters, production costs and political instability are some of the major ... Read Answer >>
  3. Why are stocks and oil so correlated right now?

    Learn whether the stock market and oil prices will continue their highly correlated price relationship or decouple again ... Read Answer >>
  4. Why did oil prices drop so much in 2014?

    Learn the roles that decreased global demand, new supply sources in North America and actions taken by Saudi Arabia played ... Read Answer >>
  5. What does a barrel of oil equivalent (BOE) refer to in the oil and gas sector?

    Find out about the oil and gas industry, what a barrel of oil equivalent refers to and what it measures in the oil and gas ... Read Answer >>
  6. If oil producers run out of room to store oil, will the price of gasoline plummet?

    Learn about what happens to gasoline price when room to store oil runs out and whether this creates a good situation for ... Read Answer >>
Hot Definitions
  1. Physical Capital

    Physical capital is one of the three main factors of production in economic theory. It consists of manmade goods that assist ...
  2. Labor Market

    The labor market refers to the supply and demand for labor, in which employees provide the supply and employers the demand. ...
  3. Demand Curve

    The demand curve is a graphical representation of the relationship between the price of a good or service and the quantity ...
  4. Goldilocks Economy

    An economy that is not so hot that it causes inflation, and not so cold that it causes a recession. This term is used to ...
  5. White Squire

    Very similar to a "white knight", but instead of purchasing a majority interest, the squire purchases a lesser interest in ...
Trading Center