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UPDATE 1-Venezuela PDVSA starts making late bond payments, Citgo in play

(Adds details on bond payments, Citgo and economy)

CARACAS, Nov 24 (Reuters) - Venezuelan state oil company PDVSA said on Friday it has started making interest payments on two bonds that could go into default next week, including one backed by shares in its U.S. refining subsidiary Citgo.

The $233 million in interest on the 2020 and 2022 bonds were due on Oct. 27 and Oct. 28. PDVSA has routinely been using 30-day grace periods to make such payments amid severe cash-flow problems in the collapsing socialist economic system.

"The government and PDVSA informs bondholders that today it has initiated the process of transferring the interest payment on the PDVSA 8.5% 2020 and PDVSA 6% 2022," the company said via Twitter.

"PDVSA calls on bondholders and investors to trust (the company) ... which has met its commitments despite vulgar sabotage by the imperialists and their domestic lackeys."

Such payments have been taking as much as two weeks to complete due in part to U.S. sanctions against the government of President Nicolas Maduro, according to bondholders, meaning both bonds are at risk of default.

The 2020 bond, issued as part of a swap operation last year, includes collateral in Citgo Holdings Inc. (Reporting by Deisy Buitrago, writing by Brian Ellsworth; Editing by Chizu Nomiyama and Susan Thomas)