As for the upcoming payments, the first is due next Friday. The price of that bond dipped from a one-year high of $86.80 last week to $83.48 on Monday. It has rallied from a 12-month low of $62.50 on Aug. 1.
PDVSA needs to pay $841 million in principal, plus interest, on that bond. It's a critical moment for Venezuela because a default is seen hastening Maduro's demise. Making matters worse, the collateral against the bond is Citgo, PDVSA's Houston-based refining and retail subsidiary.
The following week, on Nov. 2, a nearly $1.2 billion PDVSA bond is maturing. Total outstanding obligations for 2017 are about $3.4 billion, and there's no grace period for the two biggest payments.
As Venezuela's economic and political crisis worsens, foreign reserves have dwindled to just $9.9 billion. But analysts and money managers say more than half of that could be in gold and illiquid assets.
The market currently puts the odds of a Venezuelan default at 15 percent, according to an analysis by RVX Asset Management, but Zucaro says he believes the chances are closer to 40 percent. The environment is deteriorating, he says, as Venezuela's latest election results are being questioned and as sanctions on the country expand to include measures that prevent it from raising new funds.
Given the severe cash crunch, it's possible that Venezuela skipped out on the five coupon payments, which have a 30-day grace period, in order to allocate those funds to the payment due on the Oct. 27 bond, Zucaro said.