Oil and music are the lifeblood of Venezuela's economy.

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One of the main battlegrounds in Sunday's presidential election is Venezuela's shattered economy, where President Nicolás Maduro is trying to persuade voters that the nation has turned the corner after years of conflict.

The future is a little brighter now that he has been working to lower the cost of living. Venezuela's raging hyperinflation, which saw price increases peak at more than 400,000% annually in 2019, was eventually put an end to in February.

Even though annual inflation is still high—roughly 50%—it is now more controllable.

Mr. Maduro has been eager to claim the decline as his own, claiming that it is evidence of his having "the correct policies".

Sadly, though, those policies have not made much or any progress in addressing the fundamental issues that underpin the economy, most notably its historical reliance on oil at the expense of other industries.

According to the US Council on Foreign Relations think tank, "oil has taken Venezuela on an exhilarating but dangerous boom-and-bust ride since it was discovered in the country in the 1920s."

Opponents of President Maduro are now basing their expectations for an economic recovery on a new administration led by Edmundo González, his electoral opponent.

 
"A victory by the opposition would result in a renewed opening of trade and financial ties between Venezuela and the rest of the world," says Capital Economics' deputy head emerging markets economist Jason Tuvey.

Along with that, the US economic sanctions that were put in place following Mr. Maduro's generally regarded as unfair and non-free 2018 presidential election will also be lifted.

Due of this, the state-run oil company PDVSA is finding it impossible to sell its crude oil abroad and is being forced to turn to large discounts on the illegal market.

However, Mr. Tuvey warns that given the significant investment required to increase oil output and the impending peak in oil demand, reversing the economic devastation of the previous ten years will be a difficult task.

"Venezuela's economy can never get back to where it was 15 to 20 years ago," according to him. "It will be starting by and large from square one."

The late President Hugo Chávez's political movement, known as the Bolivarian Revolution, began 25 years ago and has since promised much but fallen short of delivering what is perhaps most needed in the nation: a broad-based economy.

 
The governments of Mr. Maduro and César Chávez have increased their reliance on Venezuela's mineral resources rather than diversifying away from the oil business.

They utilized PDVSA as a cash cow, milking its profits to pay for social expenditures on housing, healthcare, and transportation, with little regard for the future.

However, they also failed to make the necessary investments to keep up the current level of oil output, which has drastically decreased recently due in part, but not entirely, to US sanctions.

Although these issues were already apparent when President Chávez passed away in 2013, they have gotten worse under his successor.

"Under Chávez, Venezuela was able to ride on the coat-tails of an oil boom, up until the global financial crisis," adds Tuvey.

Twenty to thirty years ago, Venezuela was a significant producer of oil. It was formerly able to produce 3.5 million barrels per day, comparable to some of the smaller Gulf states."The oil industry is currently producing less than a million barrels per day after being totally depleted."

GDP fell sharply, falling nearly 70% since 2013.

However, in order to finance spending, Mr. Maduro resorted to printing money to make up for the drop in oil prices. This led to the uncontrollably high inflation that the nation has just recently begun to reduce.

A quarter of Venezuela's population, or more than 7.7 million individuals, have fled their country in quest of a better life as a result of the country's economic hardships.

However, there have been indications of progress for those who remain behind. Although the bolívar remains the official currency, there has been a shift toward an informal dollarization of retail transactions, where US dollars are becoming the preferred payment method for those who have access to them.

The economy has stabilized as a result, but there is a social cost.