Posted on 07/12/2006 11:16:15 AM PDT by saganite
CARACAS, Venezuela (AP) -- Venezuela-owned Citgo Petroleum Corp. has decided to stop distributing gasoline to some 1,800 U.S. stations, shedding a lackluster segment of its business while forcing the owners of those stations to find other suppliers. ADVERTISEMENT
While it may create some logistical headaches for gasoline retailers in the short term, the move should not have any impact on the nation's overall fuel supply.
Citgo, which is wholly owned by Venezuela's state oil company, currently has to purchase 130,000 barrels a day from third parties in order to meet its service contracts at 13,100 stations across the U.S. This is less profitable than selling gasoline directly from its refineries.
Instead, the Houston-based company has decided to sell to retailers only the 750,000 barrels a day that it produces at three U.S. refineries in Lake Charles, La., Corpus Christi, Texas and Lemont, Ill., according to a statement late Tuesday.
That will mean that over the next year Citgo will cease distributing gasoline in 10 states and stop supplying some stations in four additional states, Citgo spokesman Fernando Garay said Wednesday.
Chavez has long claimed that parts of Citgo's business produce losses for Venezuela and constitute a subsidy for the U.S. economy.
Oil Minister Rafael Ramirez has also charged that Citgo isn't profitable enough and that its parent, state-owned Petroleos de Venezuela SA, or PDVSA, could at some point sell off some of the company's refineries.
However, in a sign of the apparently lucrative relationship between the two companies, PDVSA announced Wednesday that it has so far earned $400 million in dividends this year from Citgo.
The states where Citgo will stop selling gasoline are: Iowa, Kansas, Kentucky, Minnesota, Missouri, Nebraska, North Dakota, Ohio, Oklahoma and South Dakota. A limited number of stations in Illinois, Texas, Arkansas and Iowa will also be affected.
Venezuela is the world's fifth-largest oil exporter and the U.S. is its top buyer. The United States relied on Venezuela for about 11 percent of its oil supply in 2005.
That's good, as they are usually 3-10cents cheaper than off base and lot's of sailors can use the extra money.
I live in Michigan. There are thousands of 7-11s here - I've never seen one that sells gas.
Not that I've seen - maybe out in the country, but not in the urban areas. Although anymore, the newer gas stations are as big as supermarkets used to be - you could actually buy most of your groceries at Mobil, BP, Sunoco, Marathon or Shell.
Thanks. I was reading something just a short while back about an area that didn't allow self serve gasoline pumps. I don't remember where it was but seems they were going to have an election to attempt to change the ordinance. Just wondering if that may have been in your area.
Have a nice day.
Well that explains why my local CITGO pumps all have the yellow jacket.
D.G., I know you've been watching this fiasco with some interest...
The bottom line is that Chavez is happy to supply Americans with gasoline produced at his refineries in the US and sells at a profit. He's unwilling to buy gasoline produced at other American refineries which also sells for the same profit. He equates buying American as a "subsidy", which shows you how shallow his economic intellect is.
Non-sequitur. Who said anything about a command-driven economy?
I gotta see this.
I'm sure the Starbuck's crew loves it. They get all those joggers and businesspeople in there - they need to have a little fun.
See Ya !!! I stopped going to Citgo years ago ...
7-11 (The Southland Corporation) is the former owner of Citgo. Southland Corp purchased what is now known as Citgo (Cities Services back then) back in 1965, sold 50% to PDVSA in the early 80's and sold the remaining % in the early 90's.
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