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U.S. sanctions against Venezuela’s state-owned oil and gas company, along with some government officials and executives, are intended to put pressure on the government headed by Nicolás Maduro.
As the interim director of the Tulane Energy Institute, which tracks energy markets and provides forecasts, and someone with 35 years of oil industry experience, I’m certain that they will also reverberate in this country too – especially in Louisiana, where the oil and gas industry is among the state’s biggest employers.

Dysfunction
Despite having the world’s biggest petroleum reserves, Venezuela is now functionally bankrupt and wracked by hyperinflation. Even before the sanctions against Petróleos de Venezuela, the state-owned company known as PDVSA, its crude production was rapidly declining.
Since the late president Hugo Chávez’s election in 1998, followed by Maduro’s rise to power in 2013, the Venezuelan government has effectively destroyed the country’s political institutions, as well as its petroleum-based economy. Oil production has declined by two-thirds, dropping from about 3 million barrels per day in 2000 to around 1.2 million barrels per day in January 2019.
During this long decline, Venezuela collected payments in advance from some of its biggest customers, and therefore cannot collect the revenue now that it would otherwise be obtaining from oil production. Thanks to this practice, it actually doesn’t earn any hard currency from much of the crude that it does export.
Instead, these export earnings actually pay off cash advances from China, Russia and Repsol, the Spanish energy company.
Refineries located along the U.S. Gulf Coast in Louisiana and Texas were just about Venezuela’s last source of hard currency. That came to a halt when the Trump administration slapped sanctions on PDVSA in late January 2019.

Crude quality
You might think that Venezuela could just find new markets for its oil, but that is harder than it may sound.
Venezuelan crude is heavy and sour, meaning it is extremely dense and contains a high percentage of sulfur. Globally, most refineries process light sweet crude into gasoline, jet fuel, diesel and other fuels and products. Only specialized “complex” refineries can handle the dense petroleum produced in Venezuela and remove its unwanted sulfur.
The U.S. refineries that can do this are mainly located along the Gulf Coast, in the Midwest and in California. Most of the rest are located in China and India.

Complex refineries
Although U.S. oil production is rising, the domestic industry still needs to import heavy crude to keep the complex refineries operating efficiently. As of early 2019, 90 percent of U.S. imports were heavy crude. Countries that export this heavy petroleum include Mexico, Canada, Colombia, Ecuador, Russia, Saudi Arabia, Nigeria and Iran.
Based on their proximity, Canada and Mexico should be good sources for U.S. refiners. However, due to delays in the construction of the Keystone XL pipeline and other pipelines that may eventually run from the northern border to the Gulf Coast, there’s no easy way to replace the blocked shipments from Venezuela.

Russia and the Saudis
Another factor is that Saudi Arabia and Russia are cutting their oil production, especially heavy sour crude, as part of an effort to shore up crude prices.
It may sound reasonable for the U.S. to simply substitute its own light sweet crude for imported heavy sour crude. But the crude distillation units at complex refineries like those in Louisiana were not designed to use ever higher percentages of light sweet crude.
These refineries require approximately 30 percent heavy crude to operate optimally. At a minimum, the Gulf Coast region needs something like 3.1 million barrels of heavy sour crude per day.
The 563,000 of barrels per day the U.S. was buying from Venezuela in November 2018 only represented 2.8 percent of the roughly 20 million barrels of crude it consumed. But those imports represented a bigger share of the heavy oil the U.S. used: 17 percent, according to my calculations.
Without that supply, Gulf Coast refineries can only reduce throughput and shut down much of their idle sulfur removal capacity.

High stakes
Shutting off heavy crude from Venezuela to Gulf Coast refineries would reduce the production of heavier distillates, such as heating oil, marine fuel oil and diesel.
Jet fuel and gasoline won’t be as affected because these products can be produced from any refinery capable of processing abundant domestic light sweet crude.
Even if U.S. refineries do eventually replace Venezuelan oil, the odds are that crude will come from farther away and cost more. That would, in turn, make diesel cost more.
This would happen not just in Louisiana, but in communities far away, as long as the delivery trucks, rail cars and vessels involved have diesel engines. The disruption would illustrate the way that U.S. sanctions intended to apply pressure on other countries can also take a toll on Americans.
This article is republished from The Conversation under a Creative Commons license.

The various candidates and political action committees involved in this fall’s election for governor are collectively sitting on nearly $17 million that will more than likely eventually be spent in the coming months on advertising, voter outreach and other campaign operations.
Based on the reports filed with the state Ethics Administration, the incumbent, Gov. John Bel Edwards, has nearly $8.4 million sitting in his campaign’s bank. But in modern politics, that’s the not the only number worth reviewing.
The super PAC that served as the flour in Edwards’ roux in 2015 is positioned to possibly double its footprint during this year’s battle. Gumbo PAC director Trey Ourso said his outfit raised $1.4 million n 2018 and has $2.1 million in cash on hand, topping the $1.1 million it collected from the last gubernatorial cycle.
Gumbo PAC was also the recipient of $2.5 million from the Democratic Governors Association last go around. With redistricting in the wings and a lack of gubernatorial races to compete with in other states, political observers predict Gumbo could see a larger injection this year, and possibly much earlier than 2015’s runoff infusion.
“We are especially pleased with the broad spectrum of support that we’ve received,” said Ourso. “It just goes to show that people from all walks of life, and with varied interests, appreciate the job that Governor Edwards is doing to move Louisiana in the right direction.”
A super PAC is allowed to raise unlimited dollars, thanks to a U.S. Supreme Court decision, but they can only spend money to support or oppose candidates or issues; they cannot coordinate on most all activities, like spending, with campaigns.
The new campaign finance report from challenger Eddie Rispone, a Baton Rouge businessman and education advocate, showed that he had more than $5.5 million in the bank as of last week, of which $5 million came from his own pockets.
Northeast Louisiana Congressman Ralph Abraham, meanwhile, revealed that he raised more than $350,000 in the final weeks of 2018, with just as much sitting in his campaign kitty as of last week.
According to the Federal Elections Commission, Abraham has nearly $104,000 in his U.S. House campaign, which legally cannot be used directly on a state race. Existing caselaw, however, may permit Abraham to transfer those holdings to a supportive super PAC — and one has surfaced.
Securing Louisiana’s Future, a pro-Abraham super PAC that has not yet filed a state campaign finance report, commenced with political activities in January. Consultant Brett Buerck, who is handling the PAC, said their fundraising has yielded “hundreds of thousands of dollars.”
SLF’s financial picture should become clearer come April 15, which is the filing deadline for PACs supporting major candidates in this fall’s elections.
Two other candidates have expressed interest in the race, including former Congressman John Fleming from Minden, who doesn’t have state campaign account and is still carrying nearly $500,000 in debt following his 2016 U.S. Senate run.
Then there’s state Sen. Sharon Hewitt of Slidell, who’s “undecided” on a future office and has more than $250,000 in the bank. She also said to be interest in making a bid for Senate president next year, which would mean running for re-election and winning this fall.

Political History: EWE and
and Mardi Gras parking
Ever have trouble finding a parking spot during Mardi Gras? You’re not alone.
In 1972, then-Gov. Edwin W. Edwards caused a minor ruckus when his automobile was parked illegally during a parade, leading to a memorable photograph from Louisiana political lore.
That year had been packed for Edwards, a first-year governor who was trying to balance a full social calendar with a special tax session. According to "Edwin Edwards: Governor of Louisiana" by Leo Honeycutt, one afternoon the governor wound up stuck in Baton Rouge during an ongoing legislative debate and couldn’t get away to New Orleans, where he was scheduled to ride in a parade as the grand marshal.
After departing the Capitol much later than expected, Edwards and his State Police security detail sped down I-10, while parade organizers held off on starting until the governor arrived.
Once Edwards was atop a float and waving to onlookers, his security detail parked the executive vehicle in a nearby spot, stayed nearby to keep watch and enjoy the parade.
The only problem was that the big, white Cadillac with the the distinct gubernatorial “LA 1” license plate was parked illegally next to a fire hydrant.
Unfortunately for both Edwards and the state police, an AP photographer snapped a shot of the car. It ran in that Sunday’s papers under the headline “FRINGE BENEFIT…”

They said it
“Crazy never takes a vacation up there. As bad as it looks on the outside you ought to see it from the inside.”
—U.S. Sen. John Kennedy, on Washington, D.C., in The Monroe News-Star
“The fiscal cliff is dead. It’s gone.”
—Gov. John Bel Edwards, on the state’s financial situation, in The Times-Picayune
For more Louisiana political news, visit www.LaPolitics.com or follow Alford and Rabalais on Twitter via @LaPoliticsNow.

Krewe of Galatea charter members gathered Feb. 20 at Café Jo Jo’s in Morgan City to “Toast to 50 Years of Galatea.” Galatea was founded in 1969 by the late Adrienne Sutton Engel.

LOGANSPORT _ No. 7 seed Logansport earned a 67-51 win over the No. 10 seeded Centerville Bulldogs in regional round of the LHSAA Class A playoffs Tuesday here at the Logansport High School Gym.
Logansport jumped to a 15-11 lead at the end of the first quarter before clinging to a 36-22 advantage at the half. Centerville went on a 10-6 surge in the third quarter, trailing Logansport by a 44-32 margin. Logansport knocked Centerville out of the regional round of the State Class 1A playoffs with a 23-21 run in the fourth quarter en route to the 67-51 win.
K. Mins and B. Lee led Logansport with 19 and 18 points respectively while T. McKeeper and K. McKeeper tallied 11 points each.
Trevyn Guilbeau and Ryan Young were the top scorers for Centerville with 13 points apiece. Guilbeau connected on three treys and a pair of deuces for 13 points while Young pumped in four 3’s while also going 1 of 2 from the line for 13 points.
Rounding out the scoring for the CHS Bulldogs were: Marquis Strawder, 9; Dravyn Guilbeau, 6; Jaylon Cooks, 6 and Jaylon Williams, 4.
Centerville, a bidistrict winner of the Northwood-Lena Gators on Friday, ended its season with a 17-10 overall record.