Venezuelas National Oil Company On Its Last Legs

[GatoGordo]

Luis Colasante
Oilprice.com July 18, 2017

"...Falling oil revenues due to low international oil prices, as well as institutionalized government corruption, caused a further backlash, leaving the government to respond once again with brute force. Tear gas, water cannons and pepper-spray were fired into crowds by the National Guard and its paramilitary force, the “colectivos”, a heavily armed civilian branch supporting the Venezuelan government.

This critical economic, political and social situation does not seem to have an easy solution. In Venezuela, 96 percent of foreign currency earnings come from oil industry, and with the collapse of oil prices, income has fallen more than 50 percent. But in addition to a decline in revenues, oil production has also dropped, adding insult to injury...

and

"...Additionally, Venezuela is suffering gasoline shortages despite having the world’s largest oil reserves. The proven oil reserve in Venezuela is recognized as the largest in the world, totaling 302 billion barrels.

Venezuelan refineries are operating significantly below operational capacity, a product of a lack of investment and maintenance, as well as a lack of technical knowledge (a lot of the highly qualified personnel from PDVSA who rebelled against Hugo Chavez’s regime in 2002 were fired and now work in various other countries, such as; Colombia, Mexico, Canada and the USA). Falling output at refineries means that Venezuela needs to import gasoline, further squeezing the national budget. Refineries are currently working at less than 40 percent of average 2016 levels as state-run oil company PDVSA is importing between 100 and 150 thousand barrels per day of gasoline and between 80 and 90 thousand barrels per day of diesel.

Venezuela’s daily demand for gasoline and diesel are 225 and 170 thousand barrels respectively. Several tankers are waiting off the coast of Venezuela to discharge cargoes as the PDVSA has difficulties in paying their shipping bills, resulting in a penalty of $26 000 per tanker per day. An almost surreal paradox in a country that owns twenty refineries; five in Venezuela and fifteen worldwide."


-snip-

https://www.yahoo.com/news/venezuela-national-oil-company-last-170000451.html

Think what you want about oil and other hydrocarbon sources of energy. When your entire economy depends upon it and your dictator/bus driver uses that income as his personal piggy bank, the end result is disaster. To make matters worse, Maduro can't pay the interest on his bonds coming due at the end of the quarter, which means he no longer has the cash to either buy off his Chavista generals, nor feed his people.

[COLGATE4]

1. Dim Successor is definitely on his last legs.