In an attempt to increase cash flow for the country's impoverished economy, Venezuelan Economy Vice President Rafael Ramirez confirmed this past week that the government is interested in selling one of its main assets on the international market, Citgo Petroleum Corp., one of the largest oil refinery and distribution networks in the United States.
"We will get rid of Citgo when we receive a lucrative offer," said Ramirez, who also serves as president of PDVSA, the state-run oil company, and as President Nicolás Maduro's energy and oil minister.
Reports claim that Venezuela has three offers on the table from Goldman Sachs, J.P. Morgan and Deutsche Bank.
The sale would be the latest attempt to create cash flow in the economically-strapped country, which is facing bankruptcy and a calamitous currency shortage. Maduro has granted Ramirez full authority to adopt whatever measures he deems necessary to solve the crisis and these measures are getting closer to U.S. economic interests.
Other unpopular measures that have been discussed include increasing gasoline prices for the domestic market. Currently, Venezuelans pay pennies for a gallon of gas.
The government acquired Citgo through PDVSA, taking full ownership of the refinery in 1990. The Houston-based company became the jewel in the crown of the country's plan to expand its oil industry abroad, guaranteeing Venezuelan crude oil's position on the international market. Citgo, which operates in Louisiana, Texas and Illinois, can produce 750,000 barrels of refined oil a day. The network controls 6,000 gas stations in 27 U.S. states, mostly on the east coast.
"Citgo should not sell for less than $10 billion," deceased President Hugo Chávez said in October 2010.
Citgo has been used by the Venezuelan government as a political tool, when it was used to distribute gas and heating oil to low-income American families on the east coast of the U.S. in partnership with Joe Kennedy's nonprofit, Citizens Energy. The government said it donated $500 million in fuel between 2005-2013.
The refinery's sale also has a strategic objective. The company is an obvious target for U.S. sanctions as tensions between Caracas and Washington grow.
Tension mounts between Colombia and Venezuela over closing of border
Transporters in Colombia claim they will suffer "incalculable" losses as a result of the night closure of the border with Venezuela, announced by the government of Maduro in order to crack down on the smuggling of oil and food.
"This will result in delays in the shipment of goods, which generates incalculable losses for owners. Each vehicle will stop producing 1 million pesos (about $500 per day) on average," said President of the Colombian National Transport Chamber, Ricardo Virviescas, to Caracol Radio.
While the socialist country grapples with shortages of basic pantry staples, some people are making a killing selling heavily subsidized oil and pantry staples in Colombian border towns. Both countries share a border of 2,200 kilometers, through which passes illegal freight covering 40 percent of commodities, plus 100,000 barrels of oil, equivalent to annual losses of $365 billion, according to Venezuelan government figures.
Maduro's administration insists the illegal trafficking of goods to Colombia is causing food shortages in Venezuela.
Follow Helena on Twitter @helepoleo
Copyright 2014 by Local10.com. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.