CITGO affected by the "Chavez touch"
By Aleksander Boyd
London 23.04.05 | If there is one characteristic that describes Hugo Chavez is incompetency. He promised Venezuelans that he would put an end to corruption; that he would turn the system of governance into an exemplary model of 'participatory democracy'; that he would devolve the dignity to the poor; that he would rescue from miserable life conditions Venezuela's street children; that he would bring down inflation, unemployment, crime; that he would found a new progressive nation. As statistics show none of the issues that were to be solved by Chavez have been, on the contrary alarming increases suggest that Venezuela's social, financial and political conditions are but elements of a bomb that can explode anytime.
In modern times the Midas touch is known to be a condition intrinsic to very successful individuals that have the capacity to turn into gold, profit, gains, dividends, or however else one may describe or perceive success, whatever they become involved with. However what term/s can one use to describe the antithesis of the Midas touch? Since I have not been able to find anything in the Greek mythology I have taken the liberty to coin the term the "Chavez touch" for every single thing in which the Venezuelan pariah becomes involved turns into dust. Take for instance PDVSA. By all accounts a success story until Chavez decided that he had to take control of a business of which he lacked the most basic knowledge. The result? Loss of: output, qualified staff, accountability, profitability, international leverage, income, market share, market value, etc. One can also use Venezuela's incipient democracy as an example but that is not the purpose of this article.
Apparently now comes the turn of CITGO, PDVSA's subsidiary in the US. Pundits have it, Juan Carlos Boué and Bernard Mommer don't qualify, that refining petroleum has turned into a rather lucrative business. CITGO's core business is precisely refining the high-sulfur Venezuelan crude oil into marketable products. For that purpose a network of refineries, eight to be more precise, were purchased by the former executives of PDVSA that thougth that the best way to secure higher income for crude oil was to own refining facilities as an integral part of the business. Record high profits have been reported by CITGO lately. However, dealing again with the "Chavez touch", the failed coupster decided 1) to appoint ignorant military cronies to the highest management positions of CITGO; 2) to act upon counsel provided by marxists that have not got a clue about the oil business, read Mommer; 3) to sale two of the CITGO's eight refineries.
CITGO has already got the PDVSA syndrome; that of being managed by a bunch of incompetent thugs incapable of running the industry efficiently. Decisions are not taken with the aim of increasing profits, market share or value. No. Rather, as with PDVSA, Fidel's toyboy dictates every action based on political motives that are detrimental to the company. PDVSA is the mirror...
The Chavez Premium has made some extra cash to few market speculators, will he touch them?
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