Gasoline Production in Oil-Rich Venezuela “Practically Paralyzed” – ValueWalk Premium

Gasoline Production in Oil-Rich Venezuela “Practically Paralyzed”

Venezuela, which has the largest oil reserves in the world, faces a shortage of gasoline of 80 percent, a situation that has kept all regions of the country on the edge of chaos.

Q3 hedge fund letters, conference, scoops etc


DavidRockDesign / Pixabay

Although Venezuela has 18 refineries throughout the world and six in its national territory, today most states face a shortage of gasoline that is reflected in endless lines of cars waiting for service.

Iván Freites, secretary of the Unitary Federation of Oil Workers of Venezuela (Futpv), pointed out that the endless lines at gas stations are due to low fuel production.

“There is no gasoline, the production of gasoline in the country is practically paralyzed. The Amuay refinery has no product to produce…In addition, 70 percent of the gasoline produced in the country is not converted into end consumer product,” he explained.

According to the representative of the oil workers, what little is produced is being exported to countries such as Cuba or China to comply with international agreements.

“There was an order from Nicolás Maduro to the Minister of Petroleum, Manuel Quevedo, to send one million barrels of oil to China. They stopped the refineries and loaded the barrels. It is even more [than] the amount that they send to Cuba,” he said.

He said that in Amuay, one of the country’s main refineries, 70,000 barrels of oil are being produced daily when the current capacity is 1,300,000, meaning the refinery is operating at just 5.4 percent of production.

The nation, which is facing a shortage of food and medicines unique to its history, has not been able to escape gasoline shortages, which affect a large part of the population and keep it paralyzed. Both private vehicles and public transport are forced to wait in long lines to access a gasoline supply that can last from four to 12 hours, depending on the region of the country.

Users on Twitter report that the shortage of gasoline is mainly in the interior of the country. They report that the main affected cities are Valencia in the state of Carabobo, Maracay in the state of Aragua, Barquisimeto in Lara, and San Carlos in Cojedes.

Oil Crisis

According to Reuters, the four distillers of the Cardón refinery, the second largest in Venezuela, are being held for lack of oil and one of the units due to a technical failure.

While this is happening, and Venezuela is paralyzing its refineries and the population is running out of gasoline, the Maduro regime has made it a priority to “give” 11 million barrels of crude oil to Cuba.

Reuters reports that the state-owned company, Petróleos de Venezuela (PDVSA), resumed the supply of oil to the island, totaling  11.74 million barrels (about 49,000 daily) since January, but just between the months of June and August, it sent the regime 4.19 million barrels, which translates into USD $248 million. All this in the middle of the worst situation PDVSA has faced, with oil production at historical lows.

Liquidation of PDVSA

The Chavista and illegitimate Constituent Assembly of Venezuela are currently seeking to liquidate the state oil company PDVSA due to the millions in debt that this company has on its books.

The liquidation of PDVSA was a situation unimaginable two decades ago when the company was the envy of the region and one of the best corporations in Latin America.

According to economist José Toro Hardy, PDVSA is the company that most contributed to the growth of the Venezuelan economy. Today it contributes most to the impoverishment of the country.

Its current production of 1,200,000 barrels per day is insufficient to meet foreign debts. The current situation is a result of abandonment, embezzlement, and massive Chavista corruption.

According to the Organization of Petroleum Exporting Countries (OPEC), Venezuela has the largest proven reserves of crude oil in the world, with an estimated 296 billion barrels. However, paradoxically, crude oil and its commercialization are not a profitable business for the South American country after the brutal neglect of socialism. PDVSA no longer produces oil or dollars.

This article was reprinted from PanAm Post.

Sabrina Martín

Sabrina Martín is a Venezuelan journalist, commentator, and editor based in Valencia with experience in corporate communication. Follow @SabrinaMartinR.

This article was originally published on Read the original article.

Saved Articles