The Wall Street Journal - USA (2020-12-07)

A8| Monday, December 7, 2020 THE WALL STREET JOURNAL.

A voter cast her ballot for members of the National Assembly in Caracas on Sunday.

MATIAS DELACROIX/ASSOCIATED PRESS

pacity closed from 2009
through 2011, in the wake of
the 2007-09 recession, accord-
ing to IHS Markit.
Nowhere is that shift more
evident than in Australia, where
a BP PLC refinery is set to close
next year and two others are
under review for possible shut-
down, stoking concerns about
energy supplies. As of 2018, do-
mestically refined fuels met
just 40% of demand in Austra-
lia, which has become increas-
ingly dependent on imports.
Australia’s once-mighty re-
fining sector is now pushing the
government for financial aid,

Continued from Page One

streets and that contrasts with

the struggle to elect (our poli-

ticians) as we did in 2015,”

said opposition leader

Juan Guaidó. “Today we

stayed at home.”

In a morning tour of seven

polling stations in greater Cara-

cas, fewer than a dozen people

were waiting to vote at each

station—a dramatic drop from

the elections earlier this decade

and in the 2000s, when partici-

pation in Venezuelan elections

meant long lines and a majority

of the electorate casting ballots.

“I didn’t go to vote because

this is a farce,” said Carmen

Bermudez, a 56-year-old de-

signer.

Boycotting the votealso

presents problems for an oppo-

sition that is ever weaker and

fractured between those who

are open to negotiating with the

regime and others who favor a

hard-line approach. One clear

outcome is that Mr. Guaidó will

no longer be president of the

National Assembly when the

new body takes power Jan. 5.

More than 50 nations consider

Mr. Guaidó as Venezuela’s legit-

imate leader. But his claim is

grounded on his being the head

of the National Assembly.

ies, the vast majority of oppo-

sition leaders opted to vigor-

ously call on their countrymen

to boycott the vote in protest

even if it meant the regime

would dominate all of govern-

ment and the armed forces.

The outcome has never re-

ally been in doubt in a country

whose government is closely

allied to Communist Cuba,

Russia and Iran. Except for a

few breakaway candidates not

allied with Mr. Maduro, ruling

party politicians are expected

to take the majority of the 277

seats in the National Assembly.

“Venezuela’s electoral fraud

has already been committed,”

U.S. Secretary of State Mike

Pompeo said Sunday on Twit-

ter. “The results announced by

the illegitimate Maduro re-

gime will not reflect the will

of the Venezuelan people.”

As in recent elections in Ven-

ezuela, there were no tradi-

tional international monitors,

and the members of the elec-

toral council had been chosen

without the participation of Mr.

Maduro’s opponents. Venezue-

lans have also expressed dis-

trust in the voting system,

which in 2017 was rocked by al-

legations of fraud after the Lon-

don-based company that pro-

vided electronic machines,

Smartmatic, said the regime

had doctored a million of the 8.

million votes cast in an election.

For Venezuela’s opposition,

the strategy on Sunday wasn’t

to win votes but rather spur

apathy and demonstrate to the

world that there was little ac-

tivity at polling sites or confi-

dence in the election. Partici-

pation was in marked contrast

to the 2015 vote for National

Assembly, when participation

topped 70% as Venezuelans

gave the opposition control of

two-thirds of the body.

“What we have in 2020 is a

fraud that you can see in the

Venezuela’s authoritarian
regime staged congressional
elections Sunday that are ex-
pected to give President Nico-
lás Maduro complete control
of all levers of power in a vote
the country’s opposition and
its supporters, including the
U.S., rejected as fraudulent.
Until now Venezuela’s sin-
gle-chamber congress, the Na-
tional Assembly, had been the
only government body under
opposition leadership. But
with Mr. Maduro’s regime hav-
ing handed control of opposi-
tion parties to allies and exiled
or jailed prominent adversar-

BYJUANFORERO
ANDGINETTEGONZALEZ

Maduro Tightens

Grip in Venezuela

Opposition boycotts

election; ruling-party

politicians set to take

most Assembly seats

mirroring requests from air-

lines and hotels in some parts

of the world. Among the com-

panies that could benefit is Am-

pol, whose Lytton refinery on

Australia’s east coast has in-

curred a loss of $100 million

since the start of the year, lead-

ing management to consider

closing it for good.

“That’s a clear financial

burden and not sustainable,”

said Matthew Halliday, Am-

pol’s chief executive.

The pandemic has been

brutal for refiners, which have

seen the margins they gener-

ate turning oil into fuel fall to

their lowest level in more than

a decade during the third

quarter, according to the IEA.

The global shakeout under

way reflects an expectation

that the effects will be lasting.

Pre-coronavirus, IHS Markit

forecast that the global appetite

for refined products would peak

at around 94.5 million barrels a

day in the mid-2030s. Now, the

firm thinks demand will top out

at roughly 91 million barrels a

day, as people work from home

more and travel less.

In the U.S., a half-dozen re-

fineries have said since the on-

set of the pandemic that they

planned to close at least a por-

tion of their facilities, accord-

ing to IHS Markit. In many

cases, their owners are plan-

ning to retool the sites to pro-

duce biofuels from products

such as animal fat or vegetable

oil, a bet that stricter govern-

ment regulations will increase

the market for greener fuels.

Marathon Petroleum Corp.,

for example, closed two refin-

eries this spring, resulting in

more than 800 job losses. The

company, which said the pan-

demic amplified an already dif-

ficult business climate, is now

considering repurposing one of

them to produce a biofuel

known as renewable diesel.

Others, such as Shell’s Con-

vent refinery near New Or-

leans, which employed some

675 people, are simply closing

up shop. Shell tried to sell the

facility, capable of processing

240,000 barrels a day of

crude, this year but failed to

find a buyer. Shell said in Oc-

tober that it plans to trim its

refining portfolio to six sites

from 14 as it wrestles with

weak demand and seeks to

make good on emissions-re-

duction commitments.

“We expect to see changes

in consumer behavior for some

time to come, and that is likely

to continue to put pressure on

demand,” Shell refining chief

Huibert Vigeveno said.

Smaller, older facilities such

as BP’s Kwinana refinery on

Australia’s far west coast are

particularly vulnerable to

competition from newer,

larger refineries abroad. BP

plans to close the 65-year-old

fuel-making facility early next

year before converting it to an

import terminal, citing low re-

fining margins and an over-

supply of fuel in the Asia-Pa-

cific market. The terminal will

employ around 60 people,

compared with the refinery’s

roughly 650, BP said.

Meanwhile, refineries owned

by Viva Energy Group Ltd.,

which counts oil trader Vitol

Group as its major shareholder,

and Ampol face reviews that

could end in their closure in

Australia. Exxon Mobil Corp.

owns a refinery there but hasn’t

indicated it is under threat.

The threat of closures has

angered unions and prompted

the government to consider

financial aid, even though it

has turned down requests for

help from other businesses

hurt by the pandemic.

“Australia’s capacity to make

its own fuel cuts to the heart of

our viability as a sovereign na-

tion,” said Daniel Walton, na-

tional secretary of the Austra-

lian Workers’ Union. “If we can’t

independently fuel our trucks,

our industry, and our defense

vehicles, then we leave our-

selves incredibly vulnerable.”

Prime Minister Scott Morri-

son’s government says it is

willing to give cash to refiners

that stay open, worried that

boosting imports will drive up

prices for fuels such as diesel

that are used by farmers and

for mining trucks. It aims to

introduce a package of mea-

sures that would essentially

subsidize every liter of fuel re-

fined in Australia starting

early next year, and include

construction of new diesel-

storage tanks.

Refineries

Are Pushed

To Brink

In Australia, the

closures have stoked

concerns about

energy supplies.

WORLD NEWS

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