AP Sources: Shipping tycoon helps Venezuela in quest for gas

International

Men stand close to their cars as they wait for hours to fill their cars up with gasoline in Caracas, Venezuela, Thursday, April 02, 2020. Lines at gas stations around the country’s capital are getting longer and longer with some saying it was only this bad during the oil worker’s strike of 2002. (AP Photo/Ariana Cubillos)

CARACAS, Venezuela (AP) — With gas lines across Venezuela growing, a controversial shipping magnate has stepped in to prevent the country from running out of fuel amid the coronavirus pandemic, The Associated Press has learned.

The fuel shortage, in the nation that sits atop the world largest crude reserves, is the latest threat to Nicolas Maduro’s rule at a time he’s under intense U.S. pressure to resign.

Wilmer Ruperti’s Maroil Trading Inc. billed state-owned oil monopoly PDVSA 12 million euros last month for the purchase of up to 250,000 barrels of 95-octane gasoline, according to a copy of the invoice obtained by the AP. The gasoline was purchased from an undisclosed Middle Eastern country, said two people familiar with the transaction on the condition of anonymity to discuss the sensitive dealings.

The single gas shipment isn’t going to resolve Venezuela’s supply problems. But with the economy paralyzed, any amount of fuel that arrives will come as welcome relief, analysts said.

Ruperti, a former oil tanker captain, has a colorful history coming to the rescue of Venezuela’s socialist revolution at critical junctures, something that endeared him to the late Hugo Chávez.

But his latest gambit, which could help stave off a deepening humanitarian crisis, is bound to irritate the Trump administration, which this week doubled down on its campaign in support of opposition leader Juan Guaidó, sending naval ships to the Caribbean on a counternarcotics mission following Maduro’s indictment in New York on narcoterrorist charges.

Venezuela’s oil fields and refineries have crumbled from years of mismanagement. More recently, fuel imports have dried up as the Trump administration tightened sanctions against Maduro, targeting two trading houses owned by Russia’s Rosneft for providing a lifeline to the embattled leader. Then came the coronavirus, which sent crude prices crashing globally and paralyzed what little was left of domestic production.

“In Venezuela, the only thing spreading faster than the coronavirus are the gasoline shortages,” said Russ Dallen, head of Caracas Capital Markets, a brokerage.

In recent days, gas lines have popped up across Caracas, which is typically immune from days’ long waits common in the rest of the country. But most stations had closed as supplies ran out.

At one of the few gas stations still open in the capital Thursday, hundreds of cars, taxis and a flatbed trucks hugged the shoulder of a highway as heavily-armed soldiers stared down motorists, some of whom had been waiting three days to fill up. Among those in the 3-kilometer long line was Javier Serrano, who relies on a beat-up blue 1968 Ford Falcon to eke out a meager living as a taxi driver.

“There’s a curfew at night and no public transportation,” the 49-year-old said. “One of my relatives could die at home because they don’t have a vehicle. We can’t even go from one house to another, or to a clinic.”

The government blames U.S. aggression for the gas shortages. On Friday, it said it was formulating a “special fuel supply plan” to restore stockpiles in the “shortest possible time,” allowing the nation to combat the coronavirus.

“We deplore the position of extremist sectors of the Venezuelan opposition that collude with foreign governments to plan and execute these actions against the Venezuelan people,” said Industry Minister Tareck El Aissami, the top economics adviser to Maduro. “History will mercilessly judge these traitors.”

Enter Ruperti, who the leftist revolution has leaned on before to get it out of economic jams.

In 2002, he chartered a fleet of Russian tankers to import gasoline amid a months’ long strike at PDVSA seeking to remove Chavez. More recently, he funded the defense of First Lady Cilia Flores’ two nephews in a politically charged U.S. narcotics trial as well as that of American Joshua Holt, who was held for two years in a Caracas jail on what were seen as trumped-up weapons charges.

Ruperti, 60, was decorated by Chavez with military honors for breaking the strike and saw his business as a prized PDVSA contractor boom. Ruperti showed his gratitude by giving the leftist leader two pistols used by independence hero Simon Bolivar, which reportedly cost him $1.6 million. Later, however, he was sued by a unit of the Russian shipping company for allegedly paying millions in bribes.

Ruperti declined to comment when contacted by the AP.

While U.S. sanctions have driven away from Venezuela many established shipping companies and commodity traders, Ruperti appears to be little fazed.

One of the documents obtained by AP shows his Swiss-based Maroil Trading AG opened accounts in dollars, euros and rubles at Moscow-based Derzhava Bank in November. One person said the gas that Maroil billed to PDVSA is en route and should arrive to Venezuela in the coming days.

Dallen estimates that it’s enough to supply Venezuela’s current demand for little more than a week.

While there have been only five deaths so far due to the coronavirus and most Venezuelans are closely observing a government-mandated lock down, a tense calm prevails over much of the country due to the gas shortages and concerns the already collapsed health care system will be overwhelmed if more people are infected. Bouts of protests have started to emerge among farmers who complain that their produce is rotting because they can’t transport it to urban centers.

“An acute gasoline shortage at this juncture would bring about a serious worsening of the country’s humanitarian crisis, putting Venezuelans’ lives at even greater risk,” said Francisco Rodriguez, a Venezuelan economist who launched Oil For Venezuela, a U.S.-based group lobbying for sanctions relief.

Whatever Ruperti’s motivations, Serrano said he’d be grateful for any relief no matter who it comes from.

He’s spent the two last nights in line, taking catnaps in his car or striking up conversation with those all around him, seemingly oblivious to the authorities’ call for social distancing.

Serrano complained that the National Guard soldiers assigned to patrol the line had threatened to write down their license plate numbers if they didn’t leave. He said the soldiers told them they were in line illegally because the rationed gasoline was reserved for essential vehicles, like the trucks delivering food to markets.

“We’re all in this same fight together,” he said. “We all have families and we all understand the situation. The soldiers are following orders, but they shouldn’t act on them just to keep us down.”

Follow Joshua Goodman on Twitter: @APjoshgoodman

Follow Scott Smith on Twitter: @ScottSmithAP

Goodman reported from Miami.

Copyright 2020 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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