• 4 minutes Energy Armageddon
  • 6 minutes How Far Have We Really Gotten With Alternative Energy
  • 10 minutes Russia Says Europe Will Struggle To Replace Its Oil Products
  • 3 hours GREEN NEW DEAL = BLIZZARD OF LIES
  • 2 mins Reality catching up with EV forecasts
  • 2 days "Natural Gas Price Fundamental Daily Forecast – Grinding Toward Summer Highs Despite Huge Short Interest" by James Hyerczyk & REUTERS on NatGas
  • 12 days US Oil Independence is a myth and will always be a myth
  • 1 day A Somewhat Realistic View of the Near Future for Electric Vehicles Worldwide
  • 7 days The Federal Reserve and Money...Aspects which are not widely known
  • 16 days Natural gas price to spike when USA is out of the market
  • 12 days Oil Stocks, Market Direction, Bitcoin, Minerals, Gold, Silver - Technical Trading <--- Chris Vermeulen & Gareth Soloway weigh in
  • 15 days "Biden Is Running U.S. Energy Security Into The Ground" by Irina Slav
  • 15 days *****5 STARS - "The Markets are Rigged" by The Corbett Report
Why Oil Won’t Trade Above $100 This Year

Why Oil Won’t Trade Above $100 This Year

Commodity analysts at Standard Chartered…

Venezuela Grapples With Extreme Gas Shortage Amid COVID-19 Crisis

A group of private oil services companies in Venezuela has called on the government to relax stringent rules against gasoline imports amid critical shortages of the essential fuel, Reuters reports, citing unnamed sources familiar with the matter.

“It is necessary, but it is not viable,” one of the sources said, commenting on the precarious situation that fuel retailers are in.

According to Venezuelan legislation, the state is the only party allowed to sell gasoline on the local market. Fuel sales are also heavily subsidized, which makes the fuel extremely cheap--this would make it extremely difficult for private sellers to turn a profit, even if Caracas allows them to start importing the fuel.

ADVERTISEMENT

Venezuela suspended imports of gasoline from the United States last year as the political row between the two escalated, and since then, a shortage of the fuel has been building. Last month, the government started to close fuel stations across the country because of the shortage. According to an unnamed source who spoke to Bloomberg in late March, the government will leave only a few stations open to be managed by the army. These, however, will only service medical, food transport, and utility vehicles.

Local production of gasoline has also been declining because of the suspension of diluent imports from the U.S. Diluents are necessary to make the superheavy Venezuelan crude more liquid and fit for refining. Refineries themselves have been suffering the effects of years of underinvestment, and run rates are low.

ADVERTISEMENT

Venezuelan refineries are currently operating at less than 10 percent of capacity, according to Reuters, because of this combination of diluent shortages and disrepair.

“Fuel is indispensable for the health and food sectors, and so we must temporarily deregulate the internal market and allow the importation of fuels from various external private sources,” a regional chapter of the Venezuelan Oil Chamber said in a tweet last week. It was the same chapter that submitted the proposal to allow imports and sales from private companies to the government in Caracas.

By Irina Slav for Oilprice.com

More Top Reads From Oilprice.com:



Join the discussion | Back to homepage

ADVERTISEMENT


ADVERTISEMENT


Leave a comment

Leave a comment

EXXON Mobil -0.35
Open57.81 Trading Vol.6.96M Previous Vol.241.7B
BUY 57.15
Sell 57.00
Oilprice - The No. 1 Source for Oil & Energy News