With a barrel of oil approaching $30 -- down from a high of around $150 just a few months ago -- countries like Venezuela, whose budget demands depend heavily on high oil prices, were forced to slash budgets and prepare for financial hardships to come.

Earlier this month Venezuelan President Hugo Chavez announced that his country's budget for 2009 would have to be slashed, as next year's spending was forecast on a price per barrel of $60.

"It's a real riches-to-rags story for Latin America in 2008," Jorge Pinon, energy fellow at the Center for Hemispheric Policy at the University of Miami, told United Press International.

Venezuela is among the region's biggest losers in the wake of falling oil prices, Pinon noted. The Venezuelan government has admitted as much as well, with the country's central bank announcing that the country's oil sector grew only 3 percent in 2008, down from 6 percent last year.

Hoping to stem the tide of Venezuela's falling oil revenue, Chavez and the country's leading energy officials have called for the Organization of Petroleum Exporting Countries to further cut oil production across the board, in hopes of halting the decline in the barrel price of oil.

At home, Venezuela in November told oil customers that production levels would be cut to counter falling oil prices, part of the OPEC agreement to reduce production across the board.

But Venezuela wasn't the only Latin American oil-producing nation suffering the ill effects of a bottomed-out energy market.

Mexican state oil company Pemex is in need of a major equipment overhaul, according to expert assessments this year, and has little capital to do it right. The sector in 2008 remained hand-tied by restrictive legislation that doesn't allow foreign companies to partner and profit from Mexican oil despite efforts by some Mexican officials this year to amend the law.

Mexican President Felipe Calderon wants to open up the Mexican energy sector to outside investment but faces stiff opposition despite assertions from experts output would most certainly increase with the help of foreign energy giants.

Coupled with production shortfalls, reserves in Mexico -- a leading supplier of oil to the United States -- are running out, according to experts and Mexican energy officials. And as it stands, Pemex does not have the expertise necessary to drill in deep water for the estimated 30 billion barrels or more believed to be beneath the gulf's ocean floor off the Mexican coast.

That means Calderon must somehow convince opponents that opening up the sector would benefit both Pemex and Mexicans in the long run.

"The Calderon administration proposal is highly likely to include a formula to allow private participation in upstream oil with emphasis in deepwater drilling," wrote Enrique Bravo, an analyst with the New York-based Eurasia Group.

Back on the South American continent, not everyone was as hard hit by the oil sector's downturn in 2008.

Brazil's state-run energy firm Petrobras will likely have to put a hold on developing its multibillion-barrel deepwater reserves until 2010 or beyond. However, this year's series of offshore finds has Brazilian leaders ready to proclaim their country the new leader in Latin American petroleum.

Last year Petrobras unveiled its discovery of the Tupi oil field, a reserve believed to hold between 5 billion and 8 billion barrels. The Tupi field became the first of a string of discoveries off the shore of Sao Paulo state that energy officials boasted would place Brazil among the ranks of the world's largest petroleum exporters. At the time, Petrobras officials said the discovery of the Tupi oil field could launch Brazil into the Top 10 oil producers in the world.

A series of new finds in 2008 near the Tupi field have oil officials clamoring to explore untapped parcels of the Atlantic, though political roadblocks still remain.

Lawmakers in Brasilia are preparing to reform the country's oil laws following several promising offshore discoveries, though the ratification of the new law likely will not take place until 2009.

The Brazilian government is planning to introduce a legal framework to redefine terms for producers hoping to begin production on the pre-salt offshore discoveries that made international headlines over the last couple of years and could catapult the country into the world's Top 10 oil producers.

Analysts say oil companies hoping to purchase a block of the new discovery should expect higher taxes and other new regulations for new operations in Brazilian waters.

New offshore finds and a body politic that wants to facilitate greater growth puts Brazil, also a global leader in ethanol and other alternative fuels, at the front of the pack of Latin American energy producers as 2008 comes to a close.

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