Venezuelan oil exports under a flagship $2 billion supply deal with the U.S. reached about 7.8 million barrels on Wednesday, vessel-tracking data and documents from state-run PDVSA showed.
Oil shipments are accelerating after the U.S. eased its blockade but not enough for PDVSA to fully reverse output cuts.
Following the U.S. capture of President Nicolas Maduro on 3 January, Caracas and Washington agreed to a deal to sell up to 50 million barrels of Venezuelan crude stored in tanks and vessels. Trading houses Vitol and Trafigura obtained the first U.S. licenses to load and export cargoes from the OPEC country.
But the supply has yet to significantly ease PDVSA's swollen inventories, which grew during a U.S. blockade on exports that lasted nearly a month and left Venezuela with tens of millions of barrels of oil in storage on land, and on loaded tankers stranded in Venezuela's waters.
Energy giant PDVSA, which in early January cut production because it had nowhere left to store the oil, has yet to fully reverse those cuts as it waits for storage levels to fall, according to the documents and company sources.
Sales have been slow because refiners have refused to pay prices the trading companies want for the oil, sources familiar with negotiations said. Difficulties in transferring and storing the stranded oil elsewhere have also slowed the flow of oil, they said.
Offers of Venezuelan flagship Merey heavy crude to U.S. refiners began last week at a discount of between $6 and $7.50 per barrel below Brent. That was above Canadian crude prices, which is a similar quality oil and readily available, giving refiners no incentive to switch to Venezuelan oil.
Vitol and Trafigura also made offers to Indian refiners at $8-8.50 per barrel below Brent. This also elicited little interest. The traders have recently deepened discounts to around $9 per barrel, but have yet to see much interest from buyers, trading sources said.
The U.S. has continued seizing Venezuela-linked tankers in the Caribbean, so shipowners have been reluctant to get involved in the trade, the trading sources added.
Vitol and Trafigura declined to comment. PDVSA did not immediately reply to requests for comment. Curacao's government last week confirmed Venezuelan oil was being stored there.
Last week, U.S. officials said some $500 million in proceeds from the first oil sales would be deposited in a fund controlled by the U.S. government.
U.S. Secretary of Energy Chris Wright told Reuters on Friday those initial sales had been negotiated at a "fair price" of around $45 per barrel for Venezuela, which represents some 11 million to 12 million barrels to be allocated through the trading firms.
It was unclear which mechanism Washington will use for future sales to reach the announced 50-million-barrel supply, but many PDVSA partners and customers are waiting for U.S. licenses to resume or expand exports.
Since the first two tankers departed from Venezuelan waters on 12 January heading to storage terminals in the Bahamas and St. Lucia in the Caribbean, five other vessels have followed, carrying Venezuelan crude to those ports and to the Bullen Bay terminal in Curacao, the shipping data showed.
Besides cargoes chartered by the trading houses, the only other company currently exporting Venezuelan crude is Chevron, PDVSA's main joint venture partner, which has accelerated shipments to some 221,000 barrels per day (bpd) so far this month from 100,000 bpd in December, according to the data.
Export volumes from traders have reached around 780,000 bpd since 12 January, when they started moving cargoes under U.S. licenses. That has taken exports to around 1 million bpd, close to normal levels but far from decongesting accumulated stocks.
Oil prices rose on Wednesday on optimism around tighter supply after a temporary shutdown at two large fields in Kazakhstan and as Venezuelan oil export volumes highlighted slow progress in reversing PDVSA's output cuts.
Venezuela's crude output fell to some 880,000 bpd in early January from 1.16 million bpd in late November following PDVSA's production cuts, which were mostly in the country's main oil region, the Orinoco Belt.
Some oilfields have begun restoring production in recent days, but most areas remain below capacity, company sources said.
Kyrgyzstan has signed a series of cooperation agreements with China and Belarus at the Fifth Forum of Regional Leaders of Shanghai Cooperation Organis...
A group of Azerbaijani civil society organisations has called for increased scrutiny of Swiss building materials giant Holcim, citing court rulings an...
The Ebola outbreak in eastern Democratic Republic of the Congo is "outpacing containment efforts" amid conflict, weak disease surveillance and limited...
Kazakhstan has reiterated that no existing route can replace the Caspian Pipeline Consortium (CPC), which carries more than 80% of the country's crude...
Iran has strongly condemned U.S. threats to impose sanctions on and bomb Oman following reported talks between Muscat and Tehran on jointly overseeing...
Kyrgyzstan has signed a series of cooperation agreements with China and Belarus at the Fifth Forum of Regional Leaders of Shanghai Cooperation Organisation (SCO) member states, underlining the country's growing economic engagement within the regional bloc.
A group of Azerbaijani civil society organisations has called for increased scrutiny of Swiss building materials giant Holcim, citing court rulings and ongoing investigations linked to its subsidiary Lafarge's activities during the Syrian conflict.
The Ebola outbreak in eastern Democratic Republic of the Congo is "outpacing containment efforts" amid conflict, weak disease surveillance and limited access to healthcare, according to London-based pharmacist and health commentator Thorrun Govind.
Kazakhstan has reiterated that no existing route can replace the Caspian Pipeline Consortium (CPC), which carries more than 80% of the country's crude oil exports through Russia to the Black Sea.
The U.S. and Iran have reportedly reached a preliminary 60-day ceasefire and nuclear talks deal, pending Donald Trump’s approval, Axios reports. Meanwhile, the GCC condemned Iran’s missile strike on a U.S. airbase in Kuwait, which Tehran said was retaliation for a U.S. strike near Bandar Abbas.
The World Health Organization (WHO) says ongoing conflict, funding pressures and international travel restrictions are complicating efforts to contain a fast-growing Ebola outbreak in the Democratic Republic of Congo (DRC).
Bolivia’s President Rodrigo Paz has taken steps towards potentially declaring a state of emergency as anti-government protests intensify in the early months of his administration.
Russian President Vladimir Putin arrived in Kazakhstan on Wednesday for a three-day state visit focused on energy, transport and economic cooperation with one of Moscow’s closest regional partners.
Muslims around the world have marked Eid al-Adha with prayers, celebrations and acts of charity, though for many Palestinians the holiday unfolded amid conflict, restrictions and loss.
India is expected to experience its weakest monsoon in more than a decade in 2026, raising concerns over crop production, food prices and economic growth as the country also grapples with inflationary pressures linked to the Iran conflict.
Kenyan authorities have arrested eight students on suspicion of arson following a fire at a girls’ boarding school that killed 16, according to the country’s Directorate of Criminal Investigations. The blaze, which happened in Kenya's Rift Valley, also injured dozens of students.
The British government has unveiled 300,000 new work experience and training placements for young people after a major review warned that rising youth unemployment could leave more young people disconnected from work, education and training.
Billions of dollars' worth of gold continue to be extracted illegally from Brazil’s Amazon rainforest, according to a Greenpeace study, despite President Luiz Inácio Lula da Silva’s pledges to curb wildcat mining.
Soaring temperatures across Europe have broken records in Portugal and sparked heat alerts in Italy and France, affecting events including the French Open tennis tournament.
You can download the AnewZ application from Play Store and the App Store.
What is your opinion on this topic?
Leave the first comment