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Montevideo, December 16th 2018 - 07:10 UTC

Venezuela scarce gasoline will be sold only to the politically loyal

Tuesday, July 31st 2018 - 07:00 UTC
Full article 11 comments
Maduro ordered a national census on 3-5 August to determine how many vehicle owners possess a homeland identity card, a document created in first quarter 2017 Maduro ordered a national census on 3-5 August to determine how many vehicle owners possess a homeland identity card, a document created in first quarter 2017
Maduro said the census is aimed at reducing waste and smuggling to neighboring countries. “There will be changes in how the national vehicle fleet uses fuel” Maduro said the census is aimed at reducing waste and smuggling to neighboring countries. “There will be changes in how the national vehicle fleet uses fuel”
Education minister Elias Jaua said the government wants to “progressively internationalize” local fuel prices to erase up to US$ 12bn in annual losses Education minister Elias Jaua said the government wants to “progressively internationalize” local fuel prices to erase up to US$ 12bn in annual losses
At the black market exchange rate of over 3.5mn strong Bolivars per dollar, drivers could buy over 792,500 gallons of gasoline for the equivalent of one US dollar At the black market exchange rate of over 3.5mn strong Bolivars per dollar, drivers could buy over 792,500 gallons of gasoline for the equivalent of one US dollar

Venezuela is taking steps to direct dwindling motor fuel to politically loyal vehicle owners. President Nicolas Maduro ordered a national census on 3-5 August to determine how many vehicle owners possess a homeland identity card, a document created in first quarter 2017 to strengthen the government's social and political surveillance capabilities.

 The homeland identity card, which the government now requires from Venezuelans seeking food and housing assistance, is separate from the longstanding national identity card with a unique identification number that is common in many countries.

Maduro said the census is aimed at reducing waste and smuggling to neighboring countries. “There will be changes in how the national vehicle fleet uses fuel,” Maduro said.

Critics including senior oil union officials warn that the census, aimed at linking vehicle ownership to possession of a homeland identity card, is the first step in a plan to tighten government controls by allocating increasingly scarce fuel supplies to government loyalists.

Vehicle owners without valid cards would have to pay higher fuel prices or could be denied fuel altogether, according to a senior official of the ruling socialist party (PSUV) familiar with the government's still-evolving fuel control plans.

Maduro did not mention possible price increases at the pump, where gasoline and diesel, when they can be found, are sold for virtually nothing.

Apparently the government plans to raise local gasoline and diesel prices to international levels in conjunction with a new national currency – called the sovereign Bolivar – that will be launched on 20 August to replace the now worthless strong Bolivar that was created in 2007 by late president Hugo Chavez.

Maduro last raised local fuel prices on 17 February 2016 by less than one US cent per gallon.

Education minister Elias Jaua, a senior PSUV official described by a presidential palace official as one of the architects of the census plan, said the government wants to “progressively internationalize” local fuel prices to erase up to US$ 12bn in annual losses that state-owned PdV incurs from local fuel sales.

At the current black market exchange rate of over 3.5mn strong Bolivars per dollar, drivers on paper could buy over 792,500 gallons of gasoline for the equivalent of one US dollar. A Venezuelan 50 cent coin denominated in the new sovereign Bolivar still would buy over 13,200 gallons of gasoline at the current local regulated price.

Maduro said the huge disparity between local and international prices is driving massive smuggling to Colombia and other neighboring countries.

Venezuelan military officials working on the country's international borders and Colombian defense and energy ministry officials have said fuel smuggling from Venezuela has fallen significantly in recent years, in line with shortages stemming from PDVSA's diminished refinery operations.

“The defense ministry now estimates unofficially that less than 15,000 b/d are smuggled by land out of Venezuela compared with over 100,000 b/d as recently as 2015,” a Venezuelan defense ministry official said. Some of the land-based smuggling has been displaced by more sophisticated illicit waterborne shipments from PDVSA terminals.

PDVSA's local refineries with a combined nameplate capacity of 1.3mn b/d “are almost shut down completely,” says a senior oil union official at PDVSA's 940,000 CRP refining complex in Paraguaná. “Local gasoline consumption has dropped below 140,000 b/d, all of it imported mainly through PDVSA crude-for- fuel swaps with foreign suppliers.”

PDVSA said its refineries are operating normally, and declined further comment.

Venezuela's national vehicle fleet totals over 4.4 million units, including 3.35mn automobiles, over 326,000 heavy cargo trucks, over 385,000 light pickup trucks, almost 100,000 buses, over 62,000 licensed taxis buses and 220,000 motorcycle taxis, according to the transportation ministry. The number of licensed motorcycle taxis vastly understates the number of motorcycles circulating nationally for which there is no accurate registry, the ministry adds.

Independent public passenger and cargo transport groups say that over 85pc of trucks and buses are idle because of a lack of spare parts such as tires, batteries, spark plugs and hoses.

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  • Jack Bauer

    “Venezuela scarce gasoline will be sold only to the politically loyal”

    Isn't that what is usually known as blackmail in civilized countries ?

    so if you want gasoline, you need to be politically 'oil'....lol...(or 'loil' ?)

    Jul 31st, 2018 - 05:01 pm 0
  • DemonTree

    @JB
    RE your comment on “Want to beat me?”
    If the mensalão started in 2004 and Jefferson revealed it in 2005 then it really wasn't going for long. And amazing that they started a new scheme while the previous one was still being investigated. What made them think they would get away with it the second time, after already being caught once?

    I didn't know Brazil's agribusiness wasn't that strong before the 90s, I though coffee and sugar cane had always been big exports, don't know what else. Was inflation high even since the 50s? I know a lot of countries in Latin America have had problem with, but Brazil's seemed especially. Even so I'm surprised it made such a different to trade, since I thought society had more or less adapted to cope with it. The economy really grew a lot under Cardoso and then Lula, I guess it's a big reason the latter was so popular.

    1/6th sentence for murderers is crazy, but you're right about lawyers in congress (Temer, for example). Even so, you'd think they'd only allow such big reductions for 'white-collar' crime, they're unlikely to be murdering anyone directly.

    “Prez/VPs all fm different parties”

    Is that the case in the current election, or don't you know yet? I had a look at the candidates in the last election, and most seemed to have a running mate from the same party.

    “By social justice I mean the system treating everyone 'equally' or, 'according' to what you put into it.”

    I'm not sure those are the same thing. In the UK you get the same amount if you worked the same number of years, regardless of how much you pay in. So that's one way of treating people equally. Or if you need to cut pensions, do you cut current or future ones? Current pensions were already promised, but if you only cut the future ones, you're treating people differently based on age. It seems complicated. How old are you now, if you don't mind me asking?

    Aug 05th, 2018 - 04:37 pm 0
  • Jack Bauer

    All parties have always vied for Ministries, high-posts in State-run Cos., so, to be honest, this was not exclusive to Lula…and wouldn’t be surprised if the foundation for the ‘mensalão’ wasn’t laid years before - in the 90s, when BZL started reaping the benefits of low inflation/ low unemployment / increasing exports (75% of which in 70s/80s was ind’l production) but back then, “bribery” usually occurred by the release of huge amounts of public funds for projects in strongholds of allies (of course, part disappeared along the way), and not a systematic, monthly payout to obtain permanent support.

    In Mar 2005, the A.G.s office denounced a corruption scheme in the (federal) post office to the STF, accusing 40 prominent politicians (mainly PT, & PP - PT’s then ally) who, along with Lula, became known as Ali Baba and the 40 thieves. 3 months later, Jefferson threw sh*t in the fan. José Dirceu, Lula’s top aide, was accused of being the mastermind, with his boss’s approval. Lula never put anything in his name, so it was hard to catch him (thus the nickname ‘teflon’ prez), and he avoided impeachment in 2007 by sucking up to Temer . As the ‘mensalão’ trial convicted very few, they became even more confident.

    Coffee /sugar were always relatively large export items, but exports only really took off with the commodities.
    Annual Inflation in the 50’s was abt 12%; 60s=30%; ’64=90%; ‘65=34%; ‘70=19%; ‘80=110% (oil crisis); ‘84=223%; ‘89=1,780%; ’94= 10% (plano Real). Erratic/high inflation made planning /competition difficult. To cope with it, the govt created monetary correction - helped, but didn’t reduce inflation.

    There are very few running mates fm the same perties.

    Re pensions, if you abide by the rules, pay in etc, you’ll receive a pension proportionate to what you put in – identical to private pension plans, AFAIC, pure logic. Eventual cuts will ‘gradually’ affect the future pensions, of those who have not yet acquired full rights.
    I'm a young 70.

    Aug 06th, 2018 - 06:40 pm 0
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