The CITGO auction will conclude on August 18, 2025. In a sweltering summer, Venezuelans will lose the nation’s most significant asset overseas.
The crown jewel of the Venezuelan state abroad has been auctioned off. CITGO Petroleum, the seventh-largest refinery in the United States and one of Venezuela’s most strategic assets for decades, has essentially been handed over to new owners through a legal process that reflects the country’s economic, political, and legal collapse.
What seemed unimaginable just a decade ago became a reality on July 3, 2025, when judicial officer Robert Pincus recommended that the Delaware court accept Dalinar Energy‘s bid of $7.38 billion. Although Vitol—the oil trading giant—submitted a higher offer exceeding $10 billion, it was disqualified for failing to meet the strict legal requirements of the process.
But how did we reach this point? Here’s a timeline of key decisions and the implications of what is now considered one of the greatest asset failures in Venezuelan history.
Timeline: The Path to Losing CITGO
2017-2019: Venezuela begins losing international cases related to illegal expropriations. Companies like Crystallex, Gold Reserve, and Rusoro Mining attain multi-million dollar arbitration awards.
2019: Juan Guaidó’s interim administration temporarily stalls the enforcement of these rulings, arguing that CITGO is a vital asset for Venezuelans.
2020-2023: U.S. courts start recognizing that creditors can settle their debts with assets from PDV Holding, CITGO’s parent company in the U.S. Over $23 billion in claims accumulate.
October 2023: Federal Judge Leonard Stark orders the auction of PDV Holding to compensate creditors.
March 2025: An initial bid of $3.7 billion from Red Tree Investments, associated with Contrarian Capital, is presented.
July 2025: After intense bidding among financial and oil groups, the judicial officer recommends Dalinar Energy as the winning bidder.
Who are the key players in this auction?
🔹 Dalinar Energy
A subsidiary of Gold Reserve, with a prior claim of $1.1 billion against Venezuela. Their bid of $7.38 billion was supported by Rusoro Mining, two subsidiaries of Koch Industries, and Siemens Energy. They succeeded by complying with all legal requirements and presenting a more credible plan to satisfy creditors.
🔹 Vitol
The oil trading giant led a bid of over $10 billion, including $5 billion in cash. However, they were disqualified by the judicial officer for not meeting formal criteria, potentially leading to future appeals.
🔹 Black Lion Capital Advisors
Provided an offer of $8 billion but was also disqualified for similar reasons.
The CITGO auction is complicated especially because PDVH is facing bondholders who they accuse of misrepresenting their rights in the process.
Why was Dalinar chosen over Vitol?
Judicial officer Robert Pincus explained that Dalinar’s offer was the highest among those that met all the legal requirements. Even though Vitol exceeded that figure, their financial structure, submission timing, or technical documentation did not comply with court rules.
Furthermore, Dalinar proposed a broader distribution of benefits to creditors in a “cascade” manner, convincing the court that it represented a fairer agreement.
Geopolitical and Economic Implications
For Venezuela: The loss of CITGO symbolizes the institutional bankruptcy of the state. An asset capable of refining 807,000 barrels daily is lost out of Venezuelan control through judicial means.
For creditors: This opens the door to recouping some of their claims. Gold Reserve, in particular, stands to benefit directly.
For the region: This auction sets a precedent for how poor sovereign decisions can lead to the forced execution of strategic assets outside the country.
For the U.S.: It reinforces the power of its judicial system to ensure compliance with international rulings, even against state actors.
What’s next?
Possible appeals from Vitol or Black Lion regarding their disqualification.
Interference from other creditors like PDVSA 2020 bondholders, laid-off PDVSA workers, and companies like Asia Genius (Hong Kong) seeking to recover awards through CITGO shares.
The final approval depends on Judge Leonard Stark, who has yet to formalize the award.
The Open Wound of Petro Exile
The story of how Venezuela lost CITGO is not merely an economic tale; it reflects the institutional degradation of a country that, after years of authoritarianism, corruption, and sanctions, has witnessed one of its most powerful symbols reduced to a bargaining chip in foreign courts.
It wasn’t an expropriation, nor a nationalization or sale. It was a stripping due to non-compliance and mismanagement. A wound that, although it will be closed in Delaware, will leave a mark in Venezuelan history for generations.
How Venezuela lost CITGO
Judicial auction of PDV Holding
CITGO Petroleum auction Delaware
Dalinar Energy bid
Vitol’s bid for CITGO
Claims against Venezuela
Venezuelan external debt
Strategic Venezuelan assets in the U.S.
Delaware court ruling CITGO
Robert Pincus CITGO recommendation
Creditors of Venezuela 2025
Energy crisis Venezuela
Companies backing Dalinar
Koch and Siemens in CITGO auction
CITGO refinery sold in the U.S.