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the upcoming scenario in Venezuela

January 31, 2019 until 2:50 pm
Last Updated on January 31, 2019 14:53

At gas stations in eastern Caracas, lines appeared this week and this was not due to the lack of gasoline, this time. Drivers have filled tanks in anticipation of the effects that US government sanctions might have on Petróleos de Venezuela.

"We do not know what's going to happen now." We are waiting, "said a worker at the petrol station at Rómulo Gallegos." You have to be aware of the news that you know what's going on, "he added.

The oil sector's restrictions that this week announced by the White House security advisor John Bolton could limit fuel supplies in the country.

"From the second half of December to the first half of January, compulsory gas purchases were made in the United States, enough to meet demand across the country for a period of 10 to 12 days." There was a serious reduction in the number of vehicles in the country. was active in 2012, what was purchased would last only five days, "explained Iván Freites, Director of the Unitary Federation of Oil Workers of Venezuela and Secretary General of the Oil and Gas Coalition of Falcón.

The union leader added that despite the recent import of fuel, the deficit will continue in the border areas for smuggling. "We have a consumption of 190,000 barrels of petrol a day, and we had a 60,000 barrel a day last year, and 60,000 barrels were imported from the United States," said Freites.

José Bodas, Secretary-General of the Futpv, said the gasoline deficit had come from 2005.

The union said the US sanctions were also affecting fuel production in the country. "The sanction for the petroleum industry limits the purchase of the necessary gasoline additives to become a convenient petrol for vehicles. We could not make gas."

Engineer and refinery expert Francisco Javier Larrañaga said that because of the collapse of the refineries Amuay, Cardón, El Palito and Puerto La Cruz did not produce high-tech gasoline. "On the one hand, sanctions restrict the currency that could be gained by the illegitimate government of Nicolas Madura and, on the other hand, we have a general deterioration in the production of gasoline. The only catalytic cracking unit in Cardoon is not working.

Bodas added that Paraguayan refinery complex operates between 20% and 25% of its capacity, and that is why imports of large quantities of gasoline are distributed in the country.

Larrañaga stressed that Maduro will have to introduce gasoline from other parts of the region due to diplomatic tensions. "Latin American countries that could import this amount of gas to supply the market break their relationship with Madu, which would be the closest country to those who can buy it."

Exports are in danger

Venetian oil exports will also be affected by sanctions. "It will be difficult to send oil to other markets because our crude oil is heavy, with lots of sulfur and metal waste, which refineries can only buy with deep conversion processes," said José Toro Hardy, former PDVSA executive director.

An expert on oil economics said that they are the only ones interested in purchasing Venezuelan oil, except in the United States, those who want to mix with light oil to achieve an average blend.

Despite the possibility that Maduro will not send more oil to the United States because he has no access to the accounts he is paying for exports, Toro Hardy believes he does not have many short-term options to replace the US market.

"It is possible that Maduro's decision is not to send more oil to the United States, because who would have those resources was Juan Guaido," he said. He argued that restrictions would also have an impact on Citgo's oil company, which would have to import oil at a higher price than other countries supplying heavy or extra heavy oil, such as Canada.

"Citgo can buy oil from other places, but never at the same price it buys from PDVSA and is processing it in the same refineries."

Venezuelan production at risk

Rafael Gallegos, a former PDVSA worker, warned that the restrictions would also have an impact on oil production in the country, which has fallen to the historic level, according to a report by the Organization of Oil Exporting Countries.

"Though you can try to introduce diluents from other countries, you will get less money to buy them, so they may have little impact on belt production," he explained.

Despite these warnings, Maduro has repeated that there is "gasoline for a while" in the country.

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