Lots of oil was discovered in Venezuela. In 1999 Hugo Chavez began to use the oil money to turn Venezuela into a socialist welfare state. He nationalized much of Venezuela's oil industry and used the money to keep the population happy. By 2006 corruption and graft in the government run oil industry was reducing output. Then oil prices dropped so a population that was used to all sorts of freebies had a lot less.
Corruption and oil output continued to get worse so less money as the years went by. Venezuela's government kept passing new taxes and regulations in an effort to raise money placing more burdens on the businesses in the country. Strikes by oil workers started in 2002 and kept getting worse haven't helped the situation. Now they don't have many parts they need to keep the oilfields running.
As pay and benefits reduced other workers went on strike until the economy was a dysfunctional mess. The government kept passing more regulations making the matter worse and you see what the result is.
