The country of Venezuela has battled through tumultuous times under United States sanctions, a poor refining network has caused gasoline shortages as well as political and social upheaval. Another country that has also been under similar scrutiny and sanctions from the United States for comparison is Iran. Over the past month, Iran has sent dozens of plane loads to Venezuela, consisting of equipment and chemicals necessary to produce gasoline as well as technicians to help jumpstart the dilapidated refineries of the South American country. In addition, five Iranian tankers are currently in route to Venezuela to help improve the growing shortage of gasoline that as of last month had consumers paying close to $8 per gallon.
On Monday, Venezuelan President Nicholas Maduro appointed his economy vice president, Tareck El Aissami as his new oil minister. El Aissami’s appointment comes at a time where the country has been dealing with hyperinflation, declining oil production, shortages on basic goods and sanctions from the United States. As if things could not get any more precarious for the OPEC nation, El Aissami was recently added to the list of America’s Ten Most Wanted Fugitives on charges of drug trafficking.
The Trump administration is not expected to grant the Chevon Corporation another waiver to operate in Venezuela as the United States begins planning to increase pressure through sanctions on the regime run by Nicolas Maduro. The most recent waiver granted to Chevron is the fourth instance that has allowed Chevron to operate in the South American country since sanctions commenced in 2018. The waiver is set to expire on April 22.
Notwithstanding OPEC production cuts, Venezuela sanctions restricting crude supply to the US Gulf Coast driving the market higher, retail gasoline prices are poised to make their annual spring run. Seasonal specification changes in gasoline have a significant impact on price.