Venezuela’s state oil company PDVSA has told eight foreign clients it will be unable to supply the contracted volumes of crude oil, a company employee told S&P Platts.
“Among the affected clients due to the low availability of crude to export are Nynas, Tipco, Chevron, CNPC, Reliance, Conoco, Valero, and Lukoil, which will partially receive the volumes established by the contracts,” the person said.
The amount the company will not be able to supply is close to half of the total committed volumes of this grade, Merey 16, for June. It only has 578,000 bpd of the grade available, while the total contracted volume is 1.271 million barrels daily. PDVSA’s total crude commitments for the month stand at 1.495 million bpd, but it only has 694,000 bpd available.

Venezuela’s PDVSA Fails To Meet Oil Supply Obligations.

When I was a little kid in school, we were told about Alonzo De Ojeda and Americo Vespucci discovering Maracaibo lake  in 1499. One of the things they saw was the indian huts built on the water and on stilts. The other thing? This tar-looking thing coming out of the bottom of lake that the natives used to waterproof their boats: Petroleum.

Vespucci, the cartographer of the expedition, was taken by the edifications that he called the region Little Venice which eventually ended up being Venezuela.

Fast forward 500+ years and decades of investing in oil infrastructure and personnel, Socialism has managed to screw up to gather enough of the product that pops naturally from underground to fulfill contracts. Like Stalin did before WWII, Chavez endeared himself in getting rid of PDVSA engineers and workers that did not align themselves with the Revolution and substituted them with politically loyal but totally petroleum-ignorant people.

In the 1970s after President Perez nationalized the oil industry (No, it was not Chavez and they keep saying) the government did a smart thing: The gave full scholarships to anybody with decent grades to go study anything oil-related to the US. While back them with the Oil boom it was said that Miami was the biggest neighborhood of Caracas because all the Venezuelans shopping there, the second biggest was Houston with all the students soaking the Oil Business.

The students came back and transformed PDVSA into a revolutionary (in the good sense) Oil company who produced 2.5 million BPD with the regularity of the tides. Equipment failure and accidents were extremely rare and the company had a worldwide reputation for excellence and innovation.

Now PDVSA is known for being the organization where the Venezuelan oil income has been deviated to secret bank accounts all over the world by Chavistas and Socialists. Corrupt to the core and slowly strangling the Goose That Laid the Golden Eggs of every penny they can.

It is a lie the Socialism hates wealth. They just hate you being wealthy, they don’t mind suffering it so the people do not have to do it. Like Sin Eaters but with caviar, champagne and penthouses.