Losses in oil production have yet to translate into a commensurate fall in oil exports, due to the heavy toll taken by the country’s economic collapse on domestic demand. But the stability of exports in the first half of the year mask a deteriorating trend, with June exports already more than 300,000 barrels per day lower than last year’s average. Despite all the headline noise about Venezuela, the most severe risks to oil markets thus still lie ahead.

The stress brought about by the oil price crash on national oil company PDVSA’s finances lie at the heart of the oil production challenge. So far the government has prioritized bond debt service payments in its allocation of available dollar liquidity, out of concern that failure to do so could have an even more crippling impact on the company’s production and exports than already experienced. Even so, the strain on PDVSA’s dollar liquidity situation is crippling.

The cash-flow situation of PDVSA is so critical that even a steep cut in its dollar transfers to the government could not keep it from falling into arrears with key oil service providers. The company has also had some trouble paying for its critically needed imports of light crude oil, used to blend with the ultra-heavy grades that make up a growing share of production. Amid worsening declines in conventional crude output, Caracas has doubled down on its bet on massive reserves of heavy oil. Due to insufficient upgrading capacity, however, marketing this crude requires blending with imported light oil or diluents, which will raise production costs. PDVSA’s inability to secure light oil imports could jeopardize exports.

Finally, PDVSA and the oil industry do not exist in a vacuum; they are deeply affected by the country’s unprecedented economic, social, and political crisis. Absent a political resolution to the current crisis, Venezuela will represent a growing supply risk for oil markets in 2017. On the other hand, a political resolution, leading to a dramatic change in economic policies that address the current financing and economic crisis, could significantly improve the country’s medium-term production outlook.

Luisa Palacios, a senior managing director at Medley Global Advisors and a fellow at Columbia University’s Center on Global Energy Policy.