Once a Cash Cow, Venezuela’s Oil Company Now Verges on Collapse
- 6 years ago
Once a Cash Cow, Venezuela’s Oil Company Now Verges on Collapse
But crude exports to China have also fallen — by nearly 15 percent over the last year — as the quality of its oil has declined
and China has increased its purchases from the United States.
Luis Giusti, who ran Pdvsa before President Hugo Chávez came to power in 1999, said Mr. Maduro’s purge was “more
of a political campaign to see if they can have some breathing room because everything is going down the drain.”
“They have been managing the corporation for 18 years
and then all of a sudden they are saying now they are going to rescue the corporation,” he added.
Before, people would be devastated if they lost a job at Pdvsa, said José, a worker in the Amuay refinery who also asked
that his last name be withheld because he feared retribution from his bosses for speaking publicly about the company.
But production in recent years has plummeted so far
that Pdvsa is no longer able to meet domestic demand for diesel and gasoline, forcing the country to import increasing amounts of both, including from the United States.
“With production going down and down, there is a spiral of less cash
and less investment and less production,” said Francisco J. Monaldi, a Venezuelan oil expert at Rice University in Houston.
This company’s struggles are particularly evident in the two sprawling refineries
that bracket this small city and form part of the Paraguaná Refining Center, one of the largest refinery complexes in the world.
But crude exports to China have also fallen — by nearly 15 percent over the last year — as the quality of its oil has declined
and China has increased its purchases from the United States.
Luis Giusti, who ran Pdvsa before President Hugo Chávez came to power in 1999, said Mr. Maduro’s purge was “more
of a political campaign to see if they can have some breathing room because everything is going down the drain.”
“They have been managing the corporation for 18 years
and then all of a sudden they are saying now they are going to rescue the corporation,” he added.
Before, people would be devastated if they lost a job at Pdvsa, said José, a worker in the Amuay refinery who also asked
that his last name be withheld because he feared retribution from his bosses for speaking publicly about the company.
But production in recent years has plummeted so far
that Pdvsa is no longer able to meet domestic demand for diesel and gasoline, forcing the country to import increasing amounts of both, including from the United States.
“With production going down and down, there is a spiral of less cash
and less investment and less production,” said Francisco J. Monaldi, a Venezuelan oil expert at Rice University in Houston.
This company’s struggles are particularly evident in the two sprawling refineries
that bracket this small city and form part of the Paraguaná Refining Center, one of the largest refinery complexes in the world.