While Citgo traces it’s origins to Oklahoma in 1910, by the 1990s the company was fully acquired by Petróleos de Venezuela (PDVSA) which is Venezuela’s state-owned oil and natural gas company.
Many have criticized the way PDSVA has been used as a political tool for Hugo Chavez’s socialist government. In 2007, for example, PDVSA expropriated assets in Venezuela owned by ExxonMobil and ConocoPhillips, just as Argentina more recently expropriated assets of the Spanish oil company Repsol. Claims of $12 billion in losses remain before the World Bank’s International Centre for Settlement of Investment Disputes.
Due to blow-back due in large part to inflammatory and anti-Western rhetoric from Hugo Chavez, Citgo’s profits in the United States have been low, leading Chavez to attempt to sell the company in 2010 for $10 billion, but he was unable to find a buyer, presumably because of the negative perception of the brand in the US. The 7-Eleven chain of convenience stores ended a two decade partnership with Citgo in 2006 due to “derogatory comments about our country and its leadership recently made by Venezuela’s president. Certainly Chavez’ position and statements over the past year or so didn’t tempt us to stay with Citgo.”
Regardless of the negative perception of the brand, and low profits, Citgo is estimated to see more than $30 billion in annual revenue from US customers. Presumably, these funds are indirectly used by the Venezuelan government, which the US government has recently suggested is working closely with Iranian operations in the region which, among other illicit operations, is believed to be “providing haven and assistance to other terrorists transiting the region.”
Approximately 30% of United States oil imports come from Latin America via Brazil, Colombia, Ecuador, Mexico, and Venezuela by 2010 estimates. Nearly 10% of that comes from Venezuela, which is the fourth largest supplier of oil imports into the United States.
Other US companies making use of oil imported from Venezuela include Chevron, Exxonmobil, Marathon, Phillips 66, and Valero according to the US Department of Energy.