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  HOME | Venezuela (Click here for more Venezuela news)

Venezuela -- With Largest Oil Supply in World -- Now Has to Ration Gasoline

By Carlos Camacho

CARACAS -- Venezuela, with largest oil reserves in the world, has now been forced to ration the sales of its gasoline, the world's cheapest, amidst shortages of the fuel.

A new woe is added to the long list of what Venezuelans already endure, no matter that is Christmas time: hyperinflation, high crime and food and medicine shortages so severe, some say a humanitarian crisis is already happening here.

The rationing order emanating from the Oil Ministry is dated December 24th, the day before Christmas and a Sunday to boot. The order says the measure is being taken to prevent drivers from "reselling" the gasoline. Gasoline in neighboring Colombia is much more expensive and state oil company PDVSA has said in the past that some 60,000 barrels a day of Venezuelan gasoline are smuggled and sold illegally in the neighboring country.

PDVSA has also admitted that gasoline is so cheap here, it doesn't even cover production costs.

A liter of premium, unleaded, 95 octane gasoline is officially sold at Bs 6. One US dollar costs Bs 100,000 in the black market. Not only gasoline in Venezuela is cheap, it's about the only thing still cheap in the land of thriving hyperinflation, clocking at about 2,000% for the year. And still somewhat plentiful, in the other 18 states. In the capital city of Caracas however, gasoline has not been rationed, and you can still fill up a SUV for less than $0.02. A small coffee at the bakers' goes for $0.10.

Gasoline sales have been limited to 30 liters per car, 5 liters per motorcycle in five central Venezuelan states. The scarcity situation is particularly dire in the Andean states of Merida, Tachira and Trujillo, as motorists there have had to stay line for as much as three days before filling up.

The rationing applies for Lara, Barinas (the home state of Maduro's mentor and predecessor, Hugo Chavez), Portuguesa, Apure and Cojedes.

"Gasoline rationing illustrates the Venezuelan situation better than any figure, image or speech," tweeted veteran newspaper editor Rafael Poleo Tuesday afternoon.

"Technically, Venezuela is in a state of siege because of the fuel crisis," summarized all-news Colombian TV station NTN24. The station reports than in some parts of Venezuela gasoline is being sold in the black market with a markup of 5,000%.

PDVSA is in dire straits: the state oil company now produces fewer than 2 million barrels a day. That is less than the almost 4 million it was producing in 1999, when Hugo Chavez first took over and the Bolivarian Revolution began.


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