Venezuela: Diesel shortage threatens to unleash another storm

Venezuela: Diesel shortage threatens to unleash another storm

With an impoverished, beaten and malnourished society, Venezuela is witnessing a new scourge for its crisis, the shortage of diesel fuel, key to the movement of goods around the country.

The long lines of carriers that are beginning to be seen herald a new storm that may break out with an unpredictable outcome.

The country that was once an oil company and today continues to sit on one of the largest oil reserves in the world, dried up in the middle of the quarantine.

Between April and May of last year it was almost impossible to find gasoline in Venezuela and the government of Nicolás Maduro, which blames the US sanctions, had to turn to Iran to import it.

However, at that time, diesel was not in short supply, the supply was not at risk and the prices of the products did not grow due to a new cycle of scarcity, as a result of the impossibility of transporting them.

EMPTY SHELVES

For the financial analyst and director of Econometrica, Henkel García, the great risk of this new situation is that, if the diesel shortage is prolonged over time, it will have an “immediate effect”, that of “seeing empty shelves” again .

We are already seeing it, especially in fresh cheeses, since that distribution chain is being affected and some vegetables and vegetables are having problems reaching the different cities”, he explains.

García warns that “we are going to see how, little by little, progressively, it will be increasingly difficult to get certain products”, in some cases, and “intermittently” in the supply of others.

If it gets complicated, what we are going to see is people who will not be able to move because public transport will not be able to work and shelves, literally, empty because the products cannot arrive”, he stresses.

However, he considers that the impact on prices will be less, something that would not happen in another country “with a healthy market economy”, but in Venezuela, “With so many years of control and a socialist spirit”, there will not be a great increase “for fear of audits and closure of companies.”

FOOD AND TRANSPORTATION, THE MOST AFFECTED

In García’s opinion, public transport and the food supply will be the most affected by this possible crisis, since “the bulk” of the damaged Venezuelan economy “is around the basic part”, which is food.

For his part, the economist from the Central University of Venezuela (UCV) Ronald Balza explains that farmers will also be affected, since, after a year of work, they can find a product that they cannot commercialize.

“At the moment when the (food) product is obtained, there is little time to transport it from one point to another and that (the shortage of diesel) can generate losses”, stresses before adding that the problem “is not only about the food that we do not eat, but about the money that (farmers) do not have for the next harvest.”

Balza stresses that Venezuela “is an impoverished country and the mobilization can maintain certain levels of activity” that, if paralyzed by scarcity, would damage trade, agriculture and “the different exchange options that may arise.”

Regarding transport, the economist also warns that a very complex situation could be generated in the midst of the wave of COVID-19 infections that Venezuela is experiencing, since diesel is used “to be able to transport the sick” and, in case of If necessary, also the corpses of those who perish from the disease caused by the new coronavirus.

A STRUCTURAL PROBLEM

However, the problem in transport is not new, it began to develop years ago due to different factors and, now, the shortage of diesel is the last edge in a key sector for the good supply of any country.

Among these problems, Balza highlights the poor state of the roads, the insecurity of transporters and producers – “those who are near the border with Colombia, in terms of kidnapping by the guerrillas”, the state of the river ports and maritime or “opportunistic checks by the alcabalas (police or military checkpoints)”.

For this reason, he considers that a good part of the country will be affected if the situation continues:

“Unfortunately, it seems easier to say which (region) would not be affected. Caracas, because the Government has always made decisions that seem to favor the capital ”.

Despite this, he warns that in the capital “no food is produced”, so he assures that “the problem of diesel is, perhaps, one of those that could worry us a lot”.

García, for his part, considers that the most affected regions would be those that are far from the production centers, although he believes that this possible shortage will not be so strong in the border states, “because they can substitute the national product for the imported one.”

In the midst of the generalized crisis that Venezuela is experiencing, this storm could return to the country an old image, that of a shortage of supplies that, at times, has hit its citizens harshly.

Melissa Galbraith
Melissa Galbraith is the World News reporter for Globe Live Media. She covers all the major events happening around the World. From Europe to Americas, from Asia to Antarctica, Melissa covers it all. Never miss another Major World Event by bookmarking her author page right here.