Markets in everything, law of one price sucking arbitrage edition

The relationship between Colombia and Venezuela has long been a tense one, but there is still arbitrage across the border.  You may recall, of course, that Venezuela has heavy gasoline subsidies and thus cheap fuel:

On arrival in Colombia, he found a stall set up by the side of the road where he regularly sells his fuel.

A 20-year-old "pimpinero" – as those who siphon off fuel are known – takes the petrol from Juan's car by sucking it out of the tank with his mouth and a hose, seemingly oblivious of any potential health risks.

The transaction is successful and Juan leaves with about $7-worth of Colombian pesos for what cost him about 50 US cents in Venezuela.

Recently, Venezuelan Energy Minister Rafael Ramirez announced that Venezuela would not be renewing an agreement on subsidised fuel with Colombia.

Here is the full story and I thank Stan T for the pointer.


To me, "smuggling" is just two free parties freely engaging in commerce. ;-)

European prices also lead to smuggling and such. High taxes have similar effects to high subsidies.

Normally I don't agree with your comments, nor find you particularly enlightening.
Now that the requisite insult is over with, that last comment was pure 100% absolute brilliance. Mulp for Secretary of State!

You may be suprised to learn that drinking peterol (whilst not smoking!) is actually not that bad for you, my Mum used to work in A&E and they got people in who did this quite regularly! Although why you would rather drink Saudis' Steal Drum Aged as opposed to a Bud is beyond me!

Thanks for your sharing.
Simple style and great versatility make Coach Handbag ideal work-and-play bags.Today you can get all the Coach purses at lower price in our store.All the Coach Outlet will actually fix the eyes of passers-by.

Comments for this post are closed