- Guillermo D. Olmo (@BBCgolmo)
- BBC World News, Caracas
“The shortage of diesel is very serious. If there is no solution, even a temporary one, in the next 15 days, the entire production chain will be paralyzed.”
It is the warning of Aquiles Hopkins, president of Fedeagro, an association that groups together agricultural producers in Venezuela.
By his account, the country’s diesel shortage has already led to entire crops being spoiled in western states due to lack of transportation to get them to markets.
The sowing of the next season is also in danger in a country where, according to the United Nations World Food Program, two-thirds of the population does not have a stable and sufficient food supply.
The problem is felt in the fields of eminently agricultural states such as Portuguesa or Táchira, but also in cities such as Caracas, where the queues for buses and trucks to receive the free diesel delivered by the State are already longer than those of individuals who wait. to get gasoline.
At the gas station on Avenida de San Martín, in western Caracas, the transporter Alberto Guerrero waits resigned at the wheel of his old truck. “I’ve been here since first thing in the morning and I still don’t know when I’ll be able to fill the tank.”
It is dedicated to the distribution of food and hardware items in Caracas, but says that has had to reduce its activity due to lack of fuel. “Before I went out five days a week; now I can only do it twice.”
Venezuelans have gotten used in recent months to dealing with a growing gasoline shortage in the country with the world’s largest proven oil reserves, but in recent weeks they have seen the problem extend to diesel.
Diesel, also called diesel or gas oil, is a liquid hydrocarbon used mainly as a fuel in heating and automotive engines, although it has many other uses.
As it is the most widely used fuel for transporting cargo, including food and medicine, experts warn that the problem can increase costs, aggravate the problem of hyperinflation, and make access to food even more difficult.
“If it is not resolved, it will drastically increase food insecurity in the country”, pronostica Hopkins.
In this context, voices are growing demanding answers from the government of Nicolás Maduro in Venezuela and demanding that of Joe Biden in the United States to lift the veto on diesel imports imposed by his predecessor, Donald Trump.
Luis Vicente León, president of the consulting firm Datanálisis, believes that “the humanitarian and economic effects may be greater than those of the gasoline shortage.”
Why is there a lack of diesel in Venezuela
Diesel production in Venezuela has suffered from the problems of PDVSA, the state oil company, which, in parallel to the economic crisis that is hitting the country, has suffered in recent years a drastic drop in its production that most experts attribute to the mismanagement of the Chavista governments.
Venezuela’s Communication Ministry did not immediately respond to a request for comment from BBC Mundo. The Venezuelan government has been blaming Venezuela’s problems for years on “the economic war” that it attributes to the United States.
Vice Admiral Edward Centeno, commander of the Falcón State Comprehensive Defense Operational Zone, admitted problems in the supply and said that PDVSA is working to normalize the supply. “Product of the blockade, a stop to do maintenance affects“, he said, and called the population to calm down.
Francisco Monaldi, an energy policy expert at the Baker Institute in the United States, told The stimulus that “PDVSA’s refineries had been presenting very severe problems for several years, and they were importing a substantial part of both gasoline and diesel.”
According to their estimates, Venezuela used before the covid pandemic-19 between 60,000 and 65,000 barrels of diesel per day, and more than half were imported.
But the tap on imports was closed in October 2020 due to a decision by the Donald Trump government, which gave another twist to its policy of sanctions against Nicolás Maduro.
US officials then informed the Italian energy company Eni, the Indian Reliance and the Spanish Repsol, which until then had been exchanging crude for diesel with PDVSA, that Washington would no longer tolerate these practices.
Already then a group of activists and Venezuelan social organizations sent a letter to Mike Pompeo and Steven T. Mnuchin, secretaries of State and Treasury respectively at the time of Trump, asking them to reconsider the ban on diesel imports due to its “devastating consequences for the population”.
Diesel is used in the generation of electricity and in the supply of water in large areas of the country, in addition to being critical for hospitals and clinics that have resorted to diesel generating plants as an alternative to the constant failures in the electricity supply.
Luis Vicente León, president of the consulting firm Datanálisis, told BBC Mundo that “Since the end of last year, no imported diesel has entered in the country and the reserves have to be depleting. ”
Estimates of how much longer the Venezuelan government can stretch those reserves vary depending on who you ask and, although there has been no official announcement on the matter, sources in the oil sector told Reuters that strict restrictions have been applied. diesel rationing.
Markets and hospitality businesses have already started to stop receiving some goods because of the shortage.
Venezuelans already suffered a similar situation with gasoline in March 2020, when, coinciding with the start of the covid-19 pandemic, the country’s gas stations ran dry, which the government dodged weeks later by increasing its price and importing fuel from Iran.
As happened then with gasoline, now also the shortage seems to be fattening the black market for diesel.
According to Hopkins, farmers find there is no diesel available, but they offer it “bachaqueado”. “There are complaints throughout the Andean axis, where a 200-liter drum is being sold for between US $ 25 and US $ 40.”
“We do not understand how, in the emergency situation in which we find ourselves, there is no diesel for the priority sectors and, nevertheless, there is it on the black market and to send it on ships to Cuba,” complains Hopkins.
What can happen now
While the government remains silent on the issue, farmers, ranchers, transporters and consumers are still waiting for a solution to avoid collapse.
Juan González, director for Western Hemisphere affairs for the Biden government, said in an interview with the EVTV network that the United States “is not in a hurry” to lift the sanctions.
According to González, the Chavista leaders “try to present the proposal to exchange diesel as a humanitarian situation, but they save it for the army or give it to Cuba, and let the people suffer.”
Despite comments like this, speculation is growing in the Venezuelan media about a possible change of opinion in Washington.
It is also recalled that, unlike other sanctions, the veto on diesel exchanges was never put in writing, which should make it easier to quit.
“The Biden government has already said that it is very sensitive to humanitarian issues and this is it, so it must be studying it,” says León.
For this analyst, if Washington does not back down, “there will not be a total disappearance of diesel in Venezuela, but the government will end up importing it from Iran and the black market and the price will increase. In the end, it will be the population that will assume the cost”.
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Eddie is an Australian news reporter with over 9 years in the industry and has published on Forbes and tech crunch.