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Montevideo, December 15th 2017 - 06:26 UTC

Venezuela Oil ministry and PDVSA come under military control

Monday, November 27th 2017 - 09:21 UTC
Full article 12 comments
Quevedo takes over from two industry veterans to become one of the most powerful players in the country, which is home to some of the world’s largest crude reserves. Quevedo takes over from two industry veterans to become one of the most powerful players in the country, which is home to some of the world’s largest crude reserves.

Venezuelan President Nicolas Maduro on Sunday tapped a National Guard major general to lead state oil company PDVSA and the Oil Ministry as the OPEC member labors under near 30-year lows in oil production.

 Industry analysts and sources said the surprise appointment of Manuel Quevedo, a former housing minister with no known energy experience, was a bad omen for the country’s already deteriorated oil industry.

Quevedo takes over from two industry veterans to become one of the most powerful players in the country, which is home to some of the world’s largest crude reserves. He will have to tackle corruption scandals and an attempted debt restructuring, within the context of a deep recession and debilitating U.S. sanctions.

“The time for a new oil revolution has come,” president Maduro said in his televised Sunday address, urging Quevedo to purge PDVSA of corruption.

Last week, six executives from U.S.-based Citgo Petroleum Corp, or Citgo, a Venezuelan-owned refiner and marketer of oil and petrochemical products, were arrested in Caracas on graft allegations. About 50 officials at state oil company PDVSA have been arrested since August in what the state prosecutor says is a “crusade” against corruption.

Sources within PDVSA and the oil industry said Maduro’s administration was using corruption allegations to sideline rivals and deepen its control of the industry, which accounts for over 90% of export revenue.

Quevedo, whom two sources close to the military identified as a Maduro ally, will take over his new roles on Monday before he is officially sworn in on Tuesday. He vowed on Sunday to bring PDVSA closer to the ideals of late leader Hugo Chavez.

”We’re going to turn PDVSA into the sacred temple of the people!“ tweeted Quevedo, who Maduro said would still dedicate 20% of his time to the “Grand Housing Mission,” a Chavez-era project.

Quevedo’s rise also highlighted the increasing power of the Venezuelan military, which has gained clout in Maduro's Cabinet and in key industries like mining and food distribution. While military appointments had also been increasing in the oil industry, PDVSA so far had been led by chemist Nelson Martinez and the Oil Ministry by engineer Eulogio Del Pino. “The military has achieved its aim of controlling PDVSA. The forecast is somber,” said Francisco Monaldi, a fellow in Latin American energy policy at the Baker Institute in Houston, echoing much of the mood in the local oil industry.

PDVSA is closely allied with Russian state oil giant Rosneft and state-owned oil major China National Petroleum Corp, although Western oil companies like U.S. major Chevron and France's Total also operate in Venezuela.

Categories: Politics, Venezuela.

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  • Jack Bauer

    “Quevedo will have to tackle corruption scandals....”....... really ? does that mean he'll have to tackle Maduro and his cronies ??
    Next Maduro move will be to officially create the drug-trafficking Ministry ...

    Nov 27th, 2017 - 05:01 pm 0
  • DemonTree

    After 18 years of Chavists in power, it is now time for a new oil revolution and crusade against corruption? What does that say about Chavismo?

    It strikes me as a risky strategy for Maduro though. Perhaps he now needs military support to stay in power, but does the military need him? Give them enough power and they might decide it would be easier to simply run things themselves. It would be sadly ironic if Venezuela avoided right-wing military dictatorship back when all it's neighbours succumbed, only to have it happen later thanks to a socialist government.

    Nov 28th, 2017 - 05:43 pm 0
  • Jack Bauer

    This crusade against corruption just sounds like a strategy to keep on fooling the more ignorant part of the population, to gain time....Maduro can now claim to fighting it, but nothing will change, for the better.
    Perhaps the military, knowing Maduro would topple without its support, is 'upping' the price to remain 'loyal'...so the new ministry could be, in fact, a way to organize corruption more efficiently, to steal without raising so many red flags. In VZ, I think the military would embrace the ideology of any leader as long as it paid off...
    Here in Brazil, seeing political opponents change sides so often, you conclude that ideology has little to do with their ambition...they use ideology as a means to 'capture' the hearts and minds of those who think populism/socialism is a solution to all economic problems. Deep down they are all made of the same crap, and their sole ambition is to steal, to become rich as quickly as possible. Their ideology boils down to whatever makes it easier to combine stealing and being popular.

    Nov 28th, 2017 - 07:59 pm 0
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