Venezuela has one of the largest oil reserves in the world, even more than Saudi Arabia.
As a wealthy country, Venezuela became heavily dependent on oil just like other oil rich countries.
Before 2008, when oil prices were high, Venezuela was a rich country, selling lots of oil and making
tons of money. However, instead of using this
money to develop other industries and diversify their economy, Venezuela provided a lot of subsidies to the people. prices were fixed at very cheap rates, and making people happy
Venezuela's socialist government at that time took over all industries, controlled the economy, and didn't allow private companies to grow.
Everything seemed fine until the massive drop in oil prices after 2008. Venezuela, being overly dependent on oil, faced a severe drop in income and economic stability.
According to Paul Krugman dependence on a single commodity export can make the economy fragile in this case Venezuela economy wasn't diversified enough to cushion the shock of the oil price drop.
Corruption also worsened their issues, low tax income due to the lack of private businesses, and economic mismanagement.
As a socialist Country, they couldn't just stop or decrease the subsidies, as it would anger the citizens.
So, they continued the subsidies by printing more money.
This excessive printing of money led to hyperinflation, where prices rose incredibly fast. The Venezuelan currency became worthless, with people even throwing it on the streets because it couldn't buy anything.