By Deisy Buitrago and Luc Cohen
CARACAS/NEW YORK, Aug 14 (Reuters) – Venezuela had few options for obtaining gasoline on Friday after the United States seized four Iranian fuel shipments en route to the fuel-starved South American country, where protests intensified over widespread gasoline shortages.
The U.S. Department of Justice said it had confiscated approximately 1.1 million barrels of fuel aboard four vessels, which were destined for Iran‘s ally, Venezuela. Tehran had successfully sent five fuel tankers to Venezuela earlier this year.
The U.S. maintains sanctions on the oil industries of both countries.
Oil refineries in once-prosperous OPEC member Venezuela have capacity to process some 1.3 million barrels per day (bpd) of crude, but they are producing little fuel due to years of underinvestment and mismanagement at state-owned oil company Petroleos de Venezuela.
The shipments in May and June from Iran – which U.S. officials have said were paid for in gold – provided a temporary respite from lengthy lines at service stations in many parts of Venezuela. But there are growing signs of a worsening fuel shortages in recent days.
Protests over gasoline shortages erupted in the western state of Lara and the eastern state of Monagas this week, images posted on social media showed.
In July, two men were fatally shot in separate crackdowns by security forces on demonstrations over fuel shortages.
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“The country should understand that the gasoline issue is here to stay,” opposition lawmaker José Guerra told reporters on Friday. “There is no way to resolve this problem now until the refineries’ problems are fixed.”
U.S. sanctions have complicated PDVSA’s swaps of crude exports for gasoline imports, exacerbating shortages. Venezuela has received no gasoline imports since Iran sent the tankers.
In July and August, Venezuela received a total of just 1 million barrels of foreign fuel between diesel and naphtha shipments, internal PDVSA documents show.
Venezuela’s socialist government ended a decades-long system of generous fuel subsidies in June due to the shortages, creating a dual system in which motorists could fill up using a monthly quota of subsidized fuel and pay for additional fuel at international prices.
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PDVSA did not immediately respond to a request for comment. The government blames the U.S. sanctions for the shortages.
According to a survey conducted by the opposition Justice First party this week, few stations offering subsidized fuel were open across the country, while those selling gasoline at high prices had lines of up to three days, lawmaker Rachid Yasbek said.
The 146,000 bpd El Palito refinery is producing between 20,000 and 40,000 bpd of gasoline, two people familiar with the matter said.
Efforts are also underway to repair the catalytic cracking unit at the 310,000 bpd Cardon refinery to restart gasoline production there.
PDVSA has restarted the No. 1 crude distillation unit at Cardon, as well as the No. 4 distillation unit at the neighboring 645,000 bpd Amuay refinery, which could provide feedstock to Cardon’s catalytic cracker.
(Reporting by Deisy Buitrago in Caracas and Luc Cohen in New York Additional reporting by Mircely Guanipa in Maracay, Venezuela and Tibisay Romero in Valencia, Venezuela and Marianna Parraga in Mexico City Editing by Daniel Flynn and David Gregorio)
