Venezuela oil: Flies on the devil’s excrement

A funny thing happened the last time I was in Venezuela. I’m in this cab. Long ride. We’re going from Caracas to Valencia, 90 minutes away, and then the driver’s going to be my chauffeur all day for $100. We’re out on the freeway rolling down out of the coast range to the savannah and he asks me about my work.

I tell him I sometimes write about oil and he tells me, all conspiratorial-like, that I must have good contacts at PDVSA, the state oil company. He asks how to get into the oil business. I tell him most people go go to university and study engineering. And he says no, I want to get into oil deals, selling Venezuelan oil. I try to explain how Venezuela decided a long time ago to put that business in the hands of the state. So if you like that sort of thing, you need to work for PDVSA. He says, no, no, all frustrated-like. I want to sell oil to a foreign country.

I repeat that PDVSA is in charge of that sort of thing, and that average José on the street can’t just start selling oil. That’s when he backs up and tries to explain why he needs contacts in PDVSA. It’ll make us both a lot of money, he says.

He had another fare, not long before, a Chadian diplomat. Yes, Chad (a country that happens to lack diplomatic representation in Venezuela). The diplomat was apparently asking all and sundry, including this cab driver, for contacts at PDVSA, because he wants oil. I tell the cabbie none of this makes any sense. Oil companies that actually have a way to receive oil know perfectly well how to go about buying it. You call the commercialization office, I tell him.

The cabbie tells me it’ll make more sense if he puts me on the phone with the diplomat. So he calls the dude and after a short explanation, I am talking to some guy with an African accent who tells me that he is representing an Indian oil company. The Indians had a deal to buy a certain quantity of Venezuelan crude at “preferential” prices. They want more. But they haven’t had any luck getting meetings with the high-level people who can sign off on such a deal.

So, he says, the Indians are ready to pay a commission to whoever can score them the oil, cheap. This is where we come in. The diplomat wanted me to work my contacts at PDVSA to get a meeting, where he, the cabbie and I could go and secure discounted oil, for India. We’ll get a commission of about $2 million that we can divide up, he says.

(I am giving you this story for free on the Internet. But, Mr. Coen and Mr. Coen, I want a cut of the box office.)

I try to explain to the guy, whoever he is, that even if for some reason I were interested, and somehow could set up such a meeting, as far as I know nobody at PDVSA can sign off on anything like this. You need a meeting with the president, I tell him. Have you tried calling the president? Gotta run!

Now aside from all the other weird things about this, to me the weirdest of all is that this guy knew I was a reporter. He had never seen my face. And yet he was so eager to make some sort of deal, and so secure that he won’t face any fallout, that he talked to me as though we were old colleagues. He was either a total fake, or unaware that this sort of deal is corrupt, or is so accustomed to it that he has no worry at all.

Anyway, not my problem. The cabbie wouldn’t give me the guy’s phone number, out of fear that he’d be cut out of the deal. I enthusiastically changed the subject and haven’t thought much about all this since.


15 thoughts on “Venezuela oil: Flies on the devil’s excrement

    1. sapitosetty Post author

      That’s just what I suspect it was. At the time I thought it was a real diplomat and was a bit concerned. But that didn’t make much sense, and now that I see that Chad has no embassy in Venezuela, I suspect it was just some schmuck out for a buck.

  1. westslope

    Once upon a time, I was working for a federal government agency. A former graduate school class-mate from Algeria who I knew a little bit but no more than just a class-mate kept on constantly harassing me for a job at this agency even though I was in a relatively junior position and kept telling him “no”.

    Anyhow, here we are at an academic conference in the same town and a couple of us go to lunch. I choose some Black African restaurant (Ethopian? I don’t recall). No way! He is not going to condescend to eat that stuff. Haven’t heard from him since.

    setty: Have you ever wondered why India is so poor and ‘undeveloped’?

    At the risk of really upsetting and annoying people: far too many of the targeted shootings here in SW British Columbia are between recent immigrants from the same country. These anecdotes suggest that impatience is a national characteristic.

      1. westslope

        Sorry I missed this one earlier.

        Francisco Toro: I appreciate the implied insult. Especially from some one who might very well be of Latin American origin given your long history of close social cooperation and lack of violence perpetrated upon each other.

        You know that racist (sic) joke? Who despises (exploits, kills) Latinos far worse than those despicable Imperialistic Yankees? Latinos themselves.

        Besides other societies organize themselves to prevent unwanted military intrusions by the hegemone. Sometimes they even send their own troops into silly, costly conflicts simply to stay on the right side of the hegemone.

        What the hell is wrong with Latin Americans? Why can’t they cooperate better among themselves? Why do they send their citizens fleeing to economic opportunities in northern economies when it clear that the first preference is to stay home.

        Assume this is a racist (sic) proposition. If so which race is targeted? La raza? Los Mapuchés? Immigrants from northern Italy?

        Various immigrant groups have throughout the colonization of New World displayed some kind of behaviour or other that was regarded as socially costly by established citizens. Most change.

        I fully expect Indo-Canadians to evolve different ways of resolving or simply engaging in disputes as time marches on. Just like I fully expect Vietnamese Canadians who figure prominently as poachers to diminish those activities going forward as they better integrate and find more appealing opportunities than poaching public fish and game.

        If Latin Americans would only stop screwing over fellow Latin Americans, more of the economies would enjoy much brisker growth, higher per capita wealth, a stronger public sector, etc. Why did it take civil war in Chile and Colombia and military dictatorship in Brazil before more market-oriented economies blossomed? Wasn’t watching Europe engulf itself in WW I and WW II enough? Did the American Civil War exhibit insufficient blood-shed? All the lessons were there! There are no excuses. None.

        Civilized northern rich market democracies have for the most part avoided conflict between each other since WW II. Latin America not so much. Civilized northern rich market democracies have for the most part either successfully co-opted radical political movements or quickly suppressed violence-wielding activists since WW II. Latin America not so much.

        I have two questions. Is the above a useful generalization or question in search of support? Or is it a heinous act of vulgar disrespect that promotes destructive typing? I want to know!

        Pardon the rant. en la lucha -w

  2. Ken Price

    Many, many years ago I was offered the same sort of “deal” in Mexico, involving PEMEX. It seems most of the government run oil companies are equally corrupt.

  3. hvalbye

    Sounds like someone should give Trafigura a call.

    But if there’s any merit do the cabdriver’s allegations, why would the government/PDVSA subsidise crude prices to Indian buyers? (Cuban, we can understand).

      1. sapitosetty Post author

        hvalbye, there are 2 questions here. Westslope answers the real “why.” But if you mean, how would they justify it ideologically, I have no idea. You’d have to ask them. I also don’t know if any of what the guy on the phone said was true.

        1. sapitosetty Post author

          Also, your comment about Trafigura shows how little you understand the situation in Venezuela. You need to get out of your Nordic bubble and go live a little. Trafigura is unlikely to sell oil at a discount just because some apparatchik accepts a bribe and shares it up the org chart. You need a real winner of a company to do that sort of thing.

        2. hvalbye

          Nordic bubble? Go out and live a little? Am I sensing some sort of attempted flagrant remark?

          And you’re right, Trafigura is obviously not in the business to SELL discounted oil. They’re whole trading franchise is, quite to the contrary, based around purchasing of distressed and ‘politically sensitive’ oil cargoes. Which, if the case in mention is legit, seem like it would fit the bill nicely.

  4. Tom ODonnell

    It´s diesel that the Africans seem to usually want. Indeed, I wonder who is scamming whom? One meets Africans in Caracas who want diesel or whatever, and had had a meeting with PDVSA and PAID money … and then they can’t get any more meetings and they want you to take them there.

    On the other hand, I was once on my way to a meeting with an editor of a xxxxxxxxx xxxxxxx in Caracas (NOT the editor of Petroleumworld … who is a well-known honest fellow), and before I get to the meeting, the mutual contact who’s bringing me there wants to know if I can find a buyer for 10,000 barrels of oil. It seems that the editor (!) has 10,000 barrels he wants to dispose of and, besides writing a piece for his publication, he wanted to ask the American to think about the oil before we got together, ’cause we could all make some money. So, I tell him it probably isn’t a good idea for a Fulbright Scholar to be the go between in such a deal, …

    Anyway, I gave the guy taking me to the meeting (a young fellow I knew before this) a hard time,saying that there is no way the editor has 10,000 barrels of oil, and even it was legit oil, say, from a family well on his finca or some such thing, then why would he need me to find someone to sell it to? (I have to be a bit obtuse here, as it might become evident who the person attempting to sell the oil was). I say to him, if he’s got oil to sell, I can give him a number at Hess in NY were they buy lots of oil – its called the spot market. But, he says that ain’t the kinda oil he’s talking about, because this oil has to be gotten out of some tanks somewhere, (eastern Venezuela, if I remember correctly).

    Then, my young friend got a call from the guy, before we arrived, and the editor decided he couldn’t make the meeting. Hmm.

    Anyway, can you imagine how easy it might be to get a little oil lost in Venezuela, or,say, at a refinery in, say, Curacao or wherever, when, for example the company’s doing maintenance on a tank farm?

    And, if a tanker shows up and takes it, and pays the guys there cash, well … then it’s gone. Anyway, India has lots of refineries that want oil, and one way to get rid of some oil you might get a hold of is to sell it to a smallish Indian tanker. Sort of the “boutique oil business”.

    And, then, there’s oil or diesel that has problems with it. Say somebody screwed up refining it and its full of sulphur or some other junk. Recently, some customer refused to take delivery of some PDVSA oil that didn’t meet specs. Call a small Indian tanker?

    P.S. Now that I think of it, I met those Africans at the same cafe where I last ran into Setty in Caracas! A small world!

    Nice story, Setty! It makes me nostalgic for Caracas.

Comments are closed.