Tuesday, January 21, 2014

Venezuela Hasn’t Delivered Home Heating Oil to U.S. Nonprofit

Joseph Kennedy II
Citgo Petroleum, the U.S. unit of state-run Petroleos de Venezuela SA, hasn’t delivered its annual oil supply for Joseph Kennedy II’s home heating assistance program.
“We very much hope that the Venezuelans will come through as they did for so many years under President Chavez’s leadership,” Kennedy, president of Citizens Energy Corp., said in an e-mailed statement today. In the meantime, the Boston-based nonprofit is unable to go forward with deliveries of heating oil to low-income households.
Citizens Energy, which has provided heating oil to about 300,000 households, signed its first contract with Venezuela in November 1979, according to its website. Venezuelan President Hugo Chavez, a self-styled socialist who once called President George W. Bush “the devil,” donated about $500 million in heating oil to the program before he died in March.
A spokesman for Caracas-based PDVSA, who asked not to be named because of company policy, said it continues to participate in the program and is investigating the status of heating oil deliveries.
Venezuela’s oil production has slid steadily since Chavez’s death as financing delays mounted, a Bloomberg survey showed. PDVSA’s ability to offset output declines at mature fields and invest in new projects is slowed by the producer’s increasing financial commitments to the government and delays obtaining financing from partners, Carlos Rossi, president of Caracas-based consultancy EnergyNomics, said in a Dec. 31 telephone interview.

Dedicated Dollars

“The economic situation in Venezuela is very bad and the non-petroleum sector is in desperate need of dollars, causing PDVSA to have to dedicate more money to the Venezuelan central bank,” said Rossi, who is also a former petroleum economist for the Venezuelan Hydrocarbon Association.
Oil accounts for 97 percent of Venezuela’s foreign currency earnings, according to the nation’s central bank.
As residents in the U.S. Northeast emerge from record cold temperatures, “Citizens Energy is ready to move forward with the heating assistance program as soon as the Venezuelans provide us with the oil,” said Kennedy, the nephew of President John F. Kennedy.
To contact the reporter on this story: Anatoly Kurmanaev in Caracas at akurmanaev1@bloomberg.net
To contact the editor responsible for this story: Andre Soliani at asoliani@bloomberg.net

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