Economist Víctor Fuentes expressed concerns regarding Petroperú’s financial woes, as Peru’s state oil company reported losses exceeding $500 million in 2023.
Talking to Sputnik, he said terrible management for many years is why the company is failing. He warns that getting back into oil production is risky.
The company’s financial report shows big problems. By September 2023, its losses reached $530 million.
This is much worse than the $60 million loss from before. The company asked the government for $3.2 billion.
They need this money to keep going and to make sure Peru has enough fuel. Fuentes works at the Peruvian Institute of Economics.
He says Petroperú’s problems didn’t just start. They come from old ways of running things that didn’t work well.
These old ways often led to poor service, giving jobs to friends, and money problems for the government.
The government has to save Petroperú with a lot of money. This stops fuel shortages. Petroperú sells most of the gasoline and diesel in Peru.
But Fuentes says these rescues hurt the country’s money in the long run. For example, the 2023 rescue took 5% of the government’s total cash for the year.
Fuentes thinks bailouts won’t fix everything. He says there are bigger problems about how the company is run.
Recently, new leaders found that old bosses may have spent money the wrong way.
Still, Fuentes believes Peru’s economy is strong despite the oil company’s problems. He doesn’t think the updates to the Talara refinery are the main problem.
This refinery is very old. Petroperú has looked after it since 1969. It costs a lot to make it better so it could make more and cleaner fuel.
Selling the Company
Fuentes says even before fixing Talara, Petroperú was not doing well. Now, as the company tries to produce more oil, it could complicate things for the government.
This is because the company isn’t ready for such a big job.
Some people think selling Petroperú to private owners might help. The political party Avanza País suggested this in September 2023.
Fuentes agrees this is hard to do right now because the company and politics are not stable.
But, he says, after fixing the money problems, working with private companies could be good. They have more experience and could help Petroperú do better.
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