There must be a political change to solve the gasoline crisis in the country generated by corruption, lack of investment, corrective and preventive maintenance, as well as the loss of trained human resources and the technical Know-How that existed in 1998, who managed processes as complex as the domestic market of hydrocarbons.
This was stated in the Forum “Gasoline Crisis in Venezuela and Solutions”, where economists Ramón Castro, expert in Hydrocarbon Commercialization, and Luis Oliveros, oil specialist, participated. It was organized by the Permanent Commission of Finance and Economic Development of the National Assembly and the Venezuelan Finance Observatory.
The economist Ramón Castro started the exposition stating that the loss of technical, social and political Know How has caused the current gasoline crisis in the country. “The trained personnel that existed in 1998 was lost, all the phases of the supply of the internal market, extremely complex management of the refineries, the distribution plants, the polyducts, the stations, the trucks, all that was lost”.
He added that there is a marked obsolescence and abandonment of corrective and preventive maintenance, because refineries used to be stopped for maintenance and upgrades, the same as all the distribution plants, which are more than 30 years old and required preventive maintenance at least every two or three years. “Today nothing of that has been done and they are totally obsolete”.
Castro said that another of the aspects that led to the gasoline crisis is the indiscriminate giveaway that has been granted to Cuba and Petrocaribe at the expense of the Venezuelan supply, in addition to the contraband extraction that basically boycotts the entire marketing system in Venezuela and the nationalization of the internal market in 2008.
“All the effort that had been made to open the internal market in 1998 that allowed the Venezuelan consumer, as he was considered at that time, to get to know the benefits of the convenience stores, the competition of service stations, was paralyzed, all that was also lost”.
He indicated that now more recently with the expropriation executed in 2008 of the transportation companies, because the entire domestic market was then reserved to the Venezuelan State and the Service Stations as was done lately. “People who had 25, 30 or 35 years of experience in service stations have been expropriated. This is basically the origin of this crisis”.
He revealed that, according to the gasoline commercialization chain, in Amuay were produced daily 178 thousand barrels; in Cardón 34 thousand; in El Palito 39 thousand and in Puerto la Cruz 30 thousand. We have a storage capacity in all plants of 5 million barrels, we have 17 fuel plants that were each perfectly maintained and automated. As far as transportation is concerned, there were about 1,431 tanker trucks to supply the service stations. There were 1,658 stations to supply 2,500 industrial customers, none of which exist now.
He indicated that the solution lies in a political change because this regime destroyed the oil industry because of its bad policies, they ended the country’s source of income, because of corruption and abandonment.
On his part, economist Luis Oliveros, oil specialist and university professor, agreed with his colleague Castro and pointed out some aspects, such as that oil consumption in 2019 is only comparable to what was consumed in 1979, that is, what was consumed 40 years ago in the country.
Oliveros maintained that the refineries in Venezuela were producing zero and were not refining a single barrel of oil, especially when the pandemic hit in March 2020.
“In short, bad management led to the collapse of the oil industry and the destruction of the refineries, the reasons are quite clear.”
He indicated that Venezuela had problems in fuel production before the arrival of the sanctions so they are not the cause of the gasoline crisis, but they do generate negative impact. “Because the State has a hard time getting anyone to sell it gasoline, it is importing the most expensive gasoline in the world and it is difficult to get the components to produce the gasoline in the country and spare parts for the refineries”.
In his opinion, this was not the best time to increase the price of gasoline because of the financial disaster in which the state finds itself, and also in the midst of a pandemic.
As to the solutions, both professionals agreed that the internal political conflict must end, otherwise it is very difficult to think that Venezuela will have a lasting solution regarding the gasoline problem.
Oliveros underlined that it is fundamental the recovery of the oil industry which is going to produce the necessary foreign currency to get out of the crisis. “It is necessary to return the institutionality of PDVSA and that there be transparency in the awarding of private service stations”.
Oliveros considers that the resources collected from the sale of gasoline and other fuels should go to PDVSA for its recovery and to establish sensible medium and long term policies.
“The problem of gasoline and fuels in the country is far from being solved. The balance between fuel supply and demand is fragile and volatile. With sanctions and a collapsed and defaulting oil industry, it is difficult to think that the refining system can recover.”