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Venezuela considers selling US oil company Citgo

Published on NewsOK Modified: August 6, 2014 at 8:54 pm •  Published: August 6, 2014

CARACAS, Venezuela (AP) — Venezuela's government has confirmed that it is considering the sale of its oil refining and distribution network in the U.S. amid a worsening economic crisis.

Analysts said the proposed sale reflects the socialist government's urgent cash shortage.

Last week, the state-owned oil company Petroleos de Venezuela SA signaled its interest in a finding a buyer for U.S.-based Citgo Petroleum Corp. in a bond prospectus. On Tuesday, Oil Minister Rafael Ramirez said Venezuela will sell Citgo if the price is right, but added that the government is not in a hurry to make a deal.

The company, believed to be worth as much as $15 billion, has long been an unloved stepchild of the revolution. The late President Hugo Chavez called Citgo a "bad business" that contributed to the tax coffers of the United States and made no profit for Venezuelans.

He repeatedly floated the idea of selling the company, which operates refineries in Texas, Louisiana and Illinois and sells fuel through thousands of gas stations. Rival Gulf Coast refiners are seen as potential buyers.

Venezuela's government has long used its U.S. company as a political tool. Chavez had Citgo distribute discounted heating oil to low-income American families in a high-profile program aimed at criticizing Washington's approach to the poor. More than 1.7 million Americans have received oil from Citgo to keep warm during the cold winter months, according to the subsidiary.

Many states initially rejected the program, but it was embraced by some. Former U.S. Rep. Joseph Kennedy II spoke out in its favor, saying Chavez cared about the poor at a time when the world elite turned a blind eye.

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