Venezuela Drivers Thirst for Gasoline Amid Biggest Oil Reserves

(Bloomberg) -- Venezuela’s state oil company was rushing to replenish gasoline supplies in various neighborhoods of Caracas on Thursday as drivers lined up at filling stations amid a worsening shortage of fuel.

While Petroleos de Venezuela SA says the situation is normalizing and blamed the lines on transport delays, the opposition says the company has had to reduce costly fuel imports as it tries to preserve cash to pay its foreign debt. Tanker trucks were seen in several neighborhoods of the capital city resupplying filling stations after local newspaper El Nacional reported widespread shortages across the country.

“Yesterday, I went to three filling stations and I couldn’t fill my tank,” Freddy Bautista, a 26-year-old student, said in an interview while waiting outside of a gas station in the Las Mercedes area of eastern Caracas on Thursday. “I’ve been waiting 30 minutes here, and it seems like I’ll be able to fill up today.”

As the company’s crumbling refineries fail to meet domestic demand, imports have become a financial burden because the country buys fuel abroad at market prices only to sell it for pennies per gallon at home. PDVSA, as the state-run producer is known, has been reducing the money-losing imports as it prepares for $2 billion in bond payments due next month, said Jose Brito, an opposition lawmaker on the National Assembly’s oil commission.

“They’re not importing enough because they are saving up to pay the debt,” he said in a telephone interview. “It’s unbelievable that this is happening in an oil producing country.”

Call for Calm

Ysmel Serrano, commercial and supply vice president at PDVSA, said on Twitter late Wednesday that the company has sufficient supply from its refineries and is working to increase shipments to stabilize distribution after transportation delays led to lines at gasoline stations in four states.

“We call for calm and to resist false rumors from sectors trying to create chaos in the country!” Serrano said.

The comments came just hours after the company said it had controlled a “minor” fire at the Amuay refinery in Falcon state, the largest refining complex in the country where a 2012 explosion killed dozens of people.

PDVSA’s press department on Thursday declined to make additional comments when contacted by Bloomberg News, but said it may release more information later in the day.

Shortages of Everything

The hunt for gasoline is just the latest headache for consumers after years of severe economic contraction and triple-digit inflation have produced shortages of everything from bread to antibiotics. Long accustomed to the world’s cheapest gasoline in the country with the world’s largest oil reserves, now Venezuelans are worried they’ll lack fuel, too.

Venezuela has been forced to increase imports of finished gasoline and components over the past years as its refinery utilization rates declined because of deteriorating infrastructure and under-investment. The country imported about 75,000 barrels a day of refined products from the U.S. in 2016, according to the U.S. Energy Information Administration.

In Caracas’ eastern Sucre municipality, around 20 cars were lined up outside of a PDVSA gas station trying to fill up. National police in the Las Mercedes part of the city, meanwhile, were trying to prevent lines from forming outside of filling stations there.

Outside of Caracas, El Carabobeno, a newspaper based in the central city of Valencia, reported widespread lines there.

--With assistance from Fabiola Zerpa and Jose Orozco

To contact the reporters on this story: Noris Soto in Caracas at nsoto9@bloomberg.net, Nathan Crooks in Miami at ncrooks@bloomberg.net.

To contact the editors responsible for this story: Nathan Crooks at ncrooks@bloomberg.net, Reg Gale at rgale5@bloomberg.net, Carlos Caminada