It’s the end of the Oil Industry as we know it (and PDVSA feels fine)
With the U.S. preparing to cut off PDVSA, you’d imagine the company would be a hubbub of contingency planning for this catastrophe. You’d be wrong.
Right now, PDVSA faces an existential crisis. With its number one customer considering sectoral sanctions that would cut off the bulk of the flow of dollars to the company, you’d expect it to be all hands on deck: a company mobilized to come up with a contingency plan to adapt to radically new circumstances.
According to this staggering Reuters piece, though, PDVSA is more interested in turning its employees out to march than in planning for The End of the World:
Political appointees are gaining clout at the expense of veteran oil executives, while employees are under mounting pressure to attend government rallies and vote for the ruling Socialists. The increasing focus on politics over performance is contributing to a rapid deterioration of Venezuela’s oil industry, home to the world’s largest crude reserves, and to a brain drain at the once world-class company.
What Alexandra Ulmer and Marianna Parraga describe is simply unbelievable. It’s as though the dinosaurs had advance notice the asteroid was going to hit and just couldn’t be bothered to do a damn thing about it. Different factions of chavismo continue to struggle for key positions inside a company that’s slowly dying, its infrastructure crumbling and its production levels low and falling.
You should check the full report. It’s not the type of thing you want to read about the most important company in the country, especially if that company has the risk of being sanctioned by the United States.
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