Nicolás Maduro has offered to supply gas to Mexico to alleviate the country’s supply crisis, aggravated by snowfall in Texas. “We must speak with our Pemex brothers [Petróleos Mexicanos]”He said this Friday during a televised event. “We must propose to supply Venezuelan gas to Mexico. Make a strategic alliance. Fulfilling the scale, the gas of the community and the industry and moving forward with international partners and putting Mexico as a priority, because it deserves it ”.
The offer to become a “safe supplier” comes from the president of a country where a large part of the population has had to turn to firewood to heat water for a coffee or cook an arepa due to deficiencies in the supply. Waiting for gas cylinders (bottles) for weeks, and even months, is routine for millions of Venezuelans who supply themselves this way. At the end of December, the explosion of 161 cylinders in a collection center in Monagas left 46 injured, of which a dozen have died. People lined up at the site to receive supplies after 10 months of total shortages.
With the fall in oil production, due to years of mismanagement by the industry, the gas industry has also plummeted. Ten years ago, Venezuela produced about three million barrels of oil a day, today that figure has been reduced to one sixth due to lack of maintenance and the loss of qualified personnel. The little production goes to the payment of debts with China, the supply commitments to Cuba and for the exchanges that it has had to implement to evade Washington’s sanctions, through which it obtains diesel and gasoline for crude oil.
Although there are four plants that could produce gas in Venezuela, only that of the Cryogenic de Jose, in the Monagas state to the east of the country, is operational but at very low capacity. The national demand for propane gas, the one carried by the cylinders that connect to the stoves, is about 55,000 barrels. Currently only 8,000 barrels of liquefied petroleum gas are produced, according to the latest data provided by Eudis Girot, a union member of the Federation of Petroleum Workers, who had been warning about the emergency in the sector and since November has been imprisoned for his complaints.
Mexico has suffered this week from a shortage of natural gas that travels through gas pipelines from the State of Texas to various power plants in the country. The disposal of the hydrocarbon from the US is usually practically immediate. The Mexican Government has sought various alternatives to alleviate the shortfalls, including the purchase of ships with liquefied petroleum gas. Maduro’s proposal seems more like a gesture towards the Mexican president, Andrés Manuel López Obrador, given that the South American country does not have natural gas production and a strategy to send liquefied petroleum gas looks, to say the least, complicated.
In June 2020, López Obrador also made an offer to the Venezuelan regime. Then the gasoline shortage in Venezuela, as a result of the sanctions imposed by Washington, led Maduro to seek fuel shipments from abroad. The Mexican offered to sell gasoline, through Pemex, to meet “a humanitarian need.” Finally, Venezuela received ships from Iran. López Obrador’s proposal was also difficult to comply with, given that 70% of the gasoline consumed in Mexico is imported, mainly from the United States.
Maduro has proposed a commercial opening, which is why he is promoting the privatization of some strategic sectors managed by the State. Thus, after 15 years of controls, it has given the go-ahead to the country’s informal dollarization and has also slowed down the price control policy. The so-called anti-blockade law sanctioned a few months ago is the regulatory framework that it has offered to stimulate the entry of new international partners to the country, evading institutional control and guaranteeing secrecy to these transactions, which could receive the veto of the United States, in the framework of sanctions imposed by former President Donald Trump and that the Joe Biden Administration has not dismantled.
Eddie is an Australian news reporter with over 9 years in the industry and has published on Forbes and tech crunch.