• 3 minutes Nucelar Deal Is Dead? Iran Distances Itself Further From ND, Alarming Russia And France
  • 5 minutes Don Jr. Tweets name Ukraine Whistleblower, Eric Ciaramella. Worked for CIA during Obama Administration, Hold over to Trump National Security Counsel under Gen McCallister, more . . . .
  • 9 minutes Shale pioneer Chesepeak will file bankruptcy soon. FINALLY ! The consolidation begins
  • 12 minutes China's Blueprint For Global Power
  • 42 mins Pioneer's Sheffield in Doghouse. Oil upset his bragging about Shale hurt prices. Now on campaign to lower expectations, prop up price.
  • 7 hours Tesla Launches Faster Third Generation Supercharger
  • 46 mins EU has already lost the Trump vs. EU Trade War
  • 8 hours Passerby doused with flammable liquid and set on fire by peaceful protesters
  • 43 mins ''Err ... but Trump ...?'' #Humph
  • 10 hours Who writes this stuff? "Crude Prices Swing Between Gains, Losses"
  • 1 hour China's Renewables Boom Hits the Wall
  • 22 hours Joe Biden, his son Hunter Biden, Ukraine Oil & Gas exploration company Burisma, and 2020 U.S. election shenanigans
  • 17 hours Climate Change Consensus Shifts in Wind, But Gas Is Still the Right Move
  • 23 hours Atty General Barr likely subpeona so called whistleblower and "leaker" Eric Ciaramella
  • 21 hours Does .001 of Atmosphere Control Earth's Climate?!
  • 22 hours Trump Interview On Farage's Radio Show #classy
Alt Text

Has Global Oil Production Really Peaked?

The lack of significant new…

Alt Text

Oil Rig Count Plunges To Lowest Level Since 2017

The oil rig count collapsed…

Alt Text

The Oil Mystery Undermining An Aramco IPO

Saudi Arabia’s oil giant Aramco…

Charles Kennedy

Charles Kennedy

Charles is a writer for Oilprice.com

More Info

Premium Content

Cash Deprived Venezuela Can’t Pay For Oil Imports, Leaving Tankers Stranded

Venezuela’s financial problems have become so acute that it is having trouble paying for the crude oil imports that it needs. Reuters reports that four oil tankers carrying more than 2 million barrels of oil are sitting off the Venezuelan coast because the state-owned oil company has not paid for the cargoes yet.

Venezuela, despite sitting on the world’s largest oil reserves and having membership in OPEC, still needs to import lighter forms of oil in order to dilute its very heavy crude. The state-owned PDVSA, however, is in a state of financial crisis, as is the state itself. According to Reuters, PDVSA has not paid BP for the oil shipments, which have been sent from the U.S., preventing them from docking at Venezuelan ports. Three BP tankers have been sitting at sea for over a month. Related: Will OPEC Use This Strategy To Defeat U.S. Shale?

Separately, other oil tankers have been backed up at Venezuelan waters because of equipment malfunctions at the ports themselves.

In order to pay for the oil from BP, PDVSA proposed an oil swap since it is short on cash. The two sides engaged in negotiations over some sort of swap deal but have been unable to come to an agreement. BP is not the only company that has failed to receive payment. Oil field services giant Schlumberger shut down some operations in Venezuela because it had not been paid for quite some time, as did Halliburton and Petrex. The cash crunch threatens to cut into Venezuela’s oil production, which would exacerbate the economic crisis, accelerating a downward economic spiral. Related: Iranian Oil Is Disguising A Significant Decline In Global Production

The backup of oil tankers at Venezuelan ports adds to the crude congestion around the world. Reuters released some shocking satellite photos of oil tankers anchored at sea outside of key Asian ports in Singapore and Shanghai. The backlog of tankers unable to discharge their cargo suggests that the oil markets are still not balanced, despite the more than 80 percent gain in prices over the past few months. The Middle East in particular is still producing at elevated levels. Iraq, for example, has had trouble exporting all the oil that it is producing, leading to port congestion at its terminal in Basra. The tanker traffic is a sign that global supplies are still exceeding demand.

By Charles Kennedy of Oilprice.com

More Top Reads From Oilprice.com:




Download The Free Oilprice App Today

Back to homepage



Leave a comment
  • GregSS on June 02 2016 said:
    It looks as though companies are starting to wise up when dealing with PDVSA, and are now asking for cargoes to be paid for in full BEFORE delivery, instead of invoicing after delivery.
  • Kr55 on June 02 2016 said:
    Venezuela and Nigeria. Two places you would be nuts to put any money into or work in if you can avoid it. Iraq is going to join their ranks later this year as it starts to degrade into a meltdown as well.
  • John on June 02 2016 said:
    Socialist Venezuela, couldn't happen to a better group of folks!

    Venezuela: the land of 500% inflation

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News
Download on the App Store Get it on Google Play