Oil Minister: “Venezuela Will Not Withdraw from the U.S. Market”
"We will maintain the refineries with which we have supply agreements"
By: Gregory Wilpert – http://www.venezuelanalysis.com/
Caracas, February 23, 2005—Venezuela’s Oil and Energy Minister Rafael Ramirez recently said, “We will not withdraw from
the U.S.” The minister’s comments were made during an interview with the Venezuelan newspaper Panorama, in which he
explained that economic considerations were leading to the conclusion that Venezuela might have to sell some of its
refineries that do not use Venezuelan crude.
“It is our greatest interest to continue in a market that is natural for us,” said Ramirez, referring to the U.S. With
regard to the possible sale of the gas station chain Citgo, which Venezuela’s state-run oil company PDVSA owns, Ramirez
said, “Opposition sectors want to connect the Citgo subject to a political decision. We will maintain the refineries
with which we have supply agreements for Venezuelan crude, where we have a good business.”
In the past few weeks, news stories had been circulating in the U.S. press that Venezuela was considering the sale of
Citgo, which has over 14,000 affiliated gas stations five refineries in the U.S. Ramirez said, however, that this is not
true. "I want to reiterate that we will maintain a position in Citgo, we are revising some positions that are not
convenient to us. There are refineries that don't refine a single barrel of Venezuelan crude and it is not viable
sending our crude to some refineries because of the distance," he said.
Neither the Citgo-owned refinery Lemont in the U.S. nor Ruhr Oel in Germany “refine a single Venezuelan barrel, so one
must ask: Was PDVSA made to buy Mexican, Russian, and Canadian crude? This is not a good business,” said Ramirez. It
would be uneconomical for the Lemont and the Ruhr Oel refineries to take Venezuelan crude, according to Ramirez, so
holding on to them makes little economic sense.
Rather, Ramirez explained, these refineries were bought solely with the intention of removing control and profits over
PDVSA from the Venezuelan state. “At this moment 48% of PDVSA’s assets are abroad and under other jurisdictions. What
few realize is that all their costs are brought to Venezuela, but here they evade taxes. A state enterprise that has a
strategy to not pay taxes to its owner is involved in an anti-national practice that we are now reversing,” added
Ramirez.
Foreign Minister Reaffirms Commitment to US Market
Similarly, in a press release issued yesterday by Venezuela’s Foreign Ministry, Minister Ali Rodríguez said that any
suggestion that Venezuela is interested in decreasing oil exports to the U.S. in favor of China is “an enormous
falsehood.” “PDVSA’s plan is to increase its production, both to supply new North American demand and that of other
countries,” said Rodriguez.
Also, a press release of the Venezuelan Embassy in the U.S. indicated that for December 2004 Venezuela supplied more oil
to the U.S. than any other country, making Venezuela the number one oil supplier to the U.S. once again. According to
the release, Venezuela supplied 1.6 million barrels per day in December. The other top three oil suppliers to the U.S.
are Canada, Mexico, and Saudi Arabia. These three, plus Venezuela, alternate in their ranking for the top four oil
suppliers of the U.S.