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Prime Minister Ralph Gonsalves says he has received no indication that PDVSA, the state-owned oil company in Venezuela, has suspended fuel shipments to St. Vincent and the Grenadines (SVG) under the PetroCaribe agreement.

He, however, said that SVG is being affected by the sanctions that the United States has imposed on the Nicolas Maduro administration in Caracas.

“We have received no such communication and they would communicate to us if it were true,” Gonsalves told a press conference in Kingstown on Thursday of allegations that the PetroCaribe oil shipments have ceased.

He further said that he contacted the Venezuelan chargé d’affaires in Kingstown, who said he had received no such information.

“This is an era of fake news and all sorts of things,” Gonsalves said.

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A report circulated via social media claimed that PDVSA was suspending oil shipments under PetroCaribe to eight countries, namely Antigua and Barbuda, Belize, Dominica, El Salvador, Haiti, Nicaragua, SVG, and St Kitts.

The Gaston Browne government in Antigua and Barbuda have dismissed the report as “fake news”.

At Thursday’s press conference, Gonsalves admitted that the U.S. sanctions began affecting SVG as early as last year.

“The impact is for Venezuela, but it has affected us,” he said, adding that so far this year, SVG has received two shipments of fuel under the PetroCaribe agreement.

He, however, said that the portion of the cost of the fuel that SVG is allowed to keep as a long-term, low-interest loan, was just EC$2.4 million.

“Last year, the sanctions started to bite. We had long-term financing of just $7 million,” he said, adding that this compared to more than $35 million in 2014.

“That’s to give you the way in which the sanctions have affected us,” Gonsalves said.

He said that the sanctions affect SVG because of the way in which the privately-owned vessels that transport the fuel from Caracas to Kingstown are paid.

“As I understand it, PDVSA has to pay the vessels …  through banks. If the money goes through an American corresponding bank or Canadian corresponding bank, they will seize them, because of the sanctions. So they have to find ways to pay them and I know they have been having difficulties finding ways to pay the people to move the fuel.”

Gonsalves said that SVG is not expected to experience a fuel crisis because of the development.

He said there are nearly 12,000 barrels of diesel in storage, in addition to 4,000 barrels of gasoline, and a much smaller amount of liquefied petroleum gas.

Fuel security, notwithstanding, SVG is being affected in two ways by the development, the most immediate being government revenue.

The government had budgeted some EC$10 million of PetroCaribe funds to finance a number of projects and programmes.

Among these is the Support for Education and Training (SET) progamme.

When the programme was launched in March 2016, it provided for one-year internships for 106 Community College and university graduates.

Under the programme, an EC$1.5 million initiative, funded by PetroCaribe, interns who have A’ Level and associate degree qualifications receive a stipend of EC$1,100 per month, while those with university degrees receive EC$2,200.

Gonsalves told Wednesday’s press conference that the impact of the sanctions would also affect his government’s housing programmes.

“It’s clear that we are not going to get $10 million in long-term financing because of these problems, so we have to find other sources to finance those things for which they were earmarked.”

Another impact is that VINLEC, SVG’s state-owned and sole commercial supplier of electricity, has to, again, purchase fuel from Sol or Rubis, the nation’s other suppliers of petroleum products.

“At the moment, VINLEC’s tanks are filled and the tanks at the Hugo Chavez storage plant at Lowmans, as I said, you have nearly 12,000 barrels.”

The prime minister said he had made it plain that his government was not going to not have Sol and Rubis operate because of the PetroCaribe initiative.

“Because you have to make sure that you have energy security so that… if PetroCaribe at anytime cannot supply to VINLEC, VINLEC will purchase from one of the other entities, whether it is Sol or Rubis. So, you don’t have to worry about St. Vincent and the Grenadines having a problem.

“I think that is very important,” the prime minister said.

He said that the geothermal project, which is expected to come onstream in 2021, three years later than scheduled, will provide greater energy security.

8 replies on “SVG feels squeeze of US sanction against Venezuela”

  1. Elma Gabriel says:

    C.ben-David, you said that this subject “TRINIDAD’S FOREX SQUEEZE IMPOVERISHING VINCIES — GONSALVES” “has nothing to do with Donald Trump. Nothing”.

    Okay, so how do you justify this topic today? “SVG FEELS SQUEEZE OF US SANCTION AGAINST VENEZUELA”. When I stated that “the best of leaders today are just followers” it was not just as assumption vented pass my brain, the capitalist regime was implemented through human greed and selfish motives so, as the world become more intelligent, leaders encounter greater challenges and are unable to function effectively.
    Therefore, the bigotry and trickery leadership approach restrict and dismantles what used to be unification between closes allies in this world. Internationally, the masses including the best of today’s leaders are hoping for a REAL LEADER. The reality is that the most promising source of ideas may come from those we least expect, example; who are the real founder of the marijuana industry? Simple, just look at the BIG Picture!

    1. A bunch of “nothing’s” The writer sounds like brainwashed leftist,who lacks an understanding of basic economics and trade!

    2. Elma whatever happens to Venezuela will affect SVG because we are so far in their debt financially. We are on our way back to reality with the huge hike in all fuel prices announced by Gonsalves. He is looking to make the users pay the shortfall that we are now experiencing in the loss of borrowed revenue from petrocarib.

      Ralph Gonsalves is the biggest borrower, scrounger and ponce that SVG has ever experienced. When he leaves he will leave SVG in the worst position it has ever been since Chatoyee betrayed us and became a general in the French army and lost the island to the British.

  2. This has been a long time coming. I’m not sure if the ministry of finance has analysts that can make informed guesses about how geopolitics affects markets, but if they don’t, maybe they should consider hiring.
    When the economic crash and soaring fuel prices were in effect, SVG had to find a way to secure it’s energy. In came Venezuela and a buddying up to oil producers of the middle East. It had to be done. At the time, the Venezuelan partnership made sense. It’s a shame that Maduro is an idiot and has totally mismanaged PDVSA and the entire country to the point of collapse. I wouldn’t blame PM for this. He made the only can he could at the time, given how cash strapped the country was and clearly still is.

  3. The USA does not tell Venezuela what it can and cannot charge for oil. I do not know if there is any guaranteed pricing in the Petrocarib agreement but what the USA does to Venezuela may not have such bad effects on our financial relationship with that nation. I am sure the government of SVG loves higher prices even if they say they do not. Anyone in SVG can notice how our government loves inflation and any other raise in taxes where they get more and more money and the economy gets more dependent.. The greed of the SVG government is unbelievable and we all see thier total lack of concern for the financial situation of the people, unless of course it involves companies that give substantial ULP political donations. Any idiot knows that the present SVG government celebrates whenever they see a situation where they can raise taxes.

  4. Please elucidate for us my dear Elma Gabriel, for I have no idea what on earth you are there writing about. This much is certain, one should always be cautious of the company one keeps, especially when dealing with matters involving economics, as associating with those of questionable reputation, would not only lower one’s own standing but most surely would also no doubt lead one astray, by the faulty assumptions, premises and data of those unscrupulous charlatans, that call themselves Socialist.

    So as Fidel Castro and Chavez await their final judgement in the prison house for the dead, Nicolás Maduro for his part, now leads the Venezuelan people a merry dance while we get caught up in his clearly failed experiment.

    1. Elma Gabriel says:

      Who are you to counsel me? I am an individual and whatever I bring to the table is well researched.

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