July 6 (Bloomberg) -- Venezuelan state oil company Petroleos de Venezuela SA issued $1.42 billion of bonds in the local market, less than half the $3 billion it planned to sell.

Demand for the zero coupon bonds, known as “Petrobonos,” totaled $7.9 billion, PDVSA said in a statement published today on its Web site. PDVSA said it received 19,034 orders for bonds, which investors can buy with local currency.

The company plans to register the notes internationally in the “coming days” on Euroclear and Clearstream, which may allow Venezuelans to resell them abroad to obtain dollars, circumventing the country’s foreign exchange controls. The smaller-than-expected size of the sale may mean it will fail to strengthen the bolivar in the parallel, unregulated currency market.

“This will be a big deception for the market and cause the parallel rate to climb,” said Asdrubal Oliveros, director of Caracas-based economic consulting firm Ecoanalitica in a telephone interview.

PDVSA, based in Caracas, is borrowing to help cover debts to suppliers that grew to more than $7 billion last year. The company has paid $2 billion and expects to eliminate remaining accounts payable by the end of July, Venezuela Energy and Oil Minister Rafael Ramirez said earlier this month.

Venezuelans turn to the parallel currency market when they can’t get government authorization to buy dollars at the official rate of 2.15 per dollar.

PDVSA only accepted bids to purchase bonds that were above 175 percent of face value, the company said in the statement. The company many issue a second tranche of the 2011 bonds, Reuters reported, citing an unidentified source at PDVSA.

Local banks and companies probably outbid individual investors to obtain the two-year bonds, which are bought in bolivars and payable in dollars, Oliveros said.

Depending on the price the bonds will be sold at in the secondary market, the implicit exchange rate for the bonds is between 6.4 bolivars per dollar and 6.98, according to Oliveros. PDVSA sold the bonds today at an average price of 180.6 percent of face value.

The bolivar weakened 1.5 percent to 6.60 per dollar today in unregulated trading before the PDVSA statement was released, traders said.

“This ratifies the government thesis that this was a bond to cover payment obligations and not to obtain dollars at a lower exchange rate,” Oliveros said. “This is bad news for the market.”

To contact the reporter on this story: Daniel Cancel in Caracas at dcancel@bloomberg.net; Matthew Walter in Caracas at mwalter4@bloomberg.net

Last Updated: July 6, 2009 21:13 EDT