Trump's Oil strategy for Venezuela Leaves Citgo Auction in Limbo
ManuelSummary:
Citgo, a well-known brand in the U.S. with a logo overlooking Kenmore Square in Boston, is the seventh largest refiner in the country.
Citgo's board on Thursday approved the company's participation in tenders the U.S. would be putting together to sell Venezuelan oil as part of an initial 50-million-barrel deal to sell Venezuelan oil, sources said. No buyers have yet been approved.
Citgo and Amber declined to comment. The refiner's supervising boards and the U.S. Treasury did not immediately reply to requests for comment.
Citgo, a well-known brand in the U.S. with a logo overlooking Kenmore Square in Boston, is the seventh largest refiner in the country.
The company's 829,000 barrel-per-day network, which has refineries in Louisiana, Texas and Illinois, is among the few in the U.S. with large capacity to process heavy crude grades like Venezuela's.
No official word from OFAC
OFAC was expected to deliver on Thursday an opinion on the Citgo auction requested by a U.S. court of appeals that is listening to parties challenging the process, including Venezuela and rival bidders led by miner Gold Reserve. But the opinion has not yet arrived.
Venezuela's legal team also on Thursday asked the same court to cancel the sale, saying the process was "legally indefensible and deeply unjust."
The Venezuelan parties, some rival bidders and creditors have also alleged conflicts of interest with court advisors, while Amber and a court officer overseeing the auction have denied any wrongdoing.
The opposition, board members close to Citgo and top executives are pressing for the judge's sale order to be frozen while U.S. and Venezuelan officials make decisions.
Other participants, especially the selected winner Amber, are pressing for the sale process to continue, the sources added. Many creditors have complained about the process' length and hefty legal fees.
Both the Venezuelan government and the opposition have pushed for the OPEC country to at least partially retain Citgo, a subject of Venezuelan pride.
Machado, who is expected to meet with Trump next week, wants to use Citgo as a tool for Venezuela's oil industry reconstruction. Her team has proposed that creditors in the court-ordered auction join a wider foreign debt restructuring effort.
Source: Reuters
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