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Military Taking Over PDVSA

Military Taking Over PDVSAMilitary Taking Over PDVSA

The general appointed to run Venezuela's energy sector will bring more military officials into the senior ranks of state oil company PDVSA during a major shakeup intended to root out corruption, two company sources told Reuters on Monday.

Industry analysts and sources said the surprise appointment of Manuel Quevedo, a former housing minister with no known energy experience, was a bad omen for the country's already deteriorated oil industry, CNBC reported.

Quevedo takes over from two industry veterans to become one of the most powerful players in the country, which is home to the world's largest crude reserves. He will have to tackle corruption scandals and an attempted debt restructuring, within the context of a deep recession and debilitating US sanctions.

"The time for a new oil revolution has come," leftist Maduro said in his televised Sunday address, urging Quevedo to purge PDVSA of corruption.

Last week, six executives from US-based Citgo, a Venezuelan-owned refiner and marketer of oil and petrochemical products, were arrested in Caracas on graft allegations. About 50 officials at state oil company PDVSA have been arrested since August in what the state prosecutor says is a crusade against corruption.

It was unclear how Quevedo plans to increase oil production, or what position he would have in Venezuela's complex attempt to restructure its debt, although his appointment is likely to worry bondholders. One PDVSA source, who asked not to be named, said a PDVSA board reshuffle was due in the next few days.

Quevedo's rise also highlighted the increasing power of the Venezuelan military, which has gained clout in Maduro's Cabinet and in key industries like mining and food distribution.

 

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