The United States didn’t import any crude oil from Venezuela in the week to March 15, for the first time ever since the EIA began tracking weekly U.S. crude oil imports.
According to EIA’s monthly data dating back to 1973, the U.S. has never skipped a month without importing crude oil from Venezuela.
The U.S. imposed sweeping sanctions on Venezuela’s oil industry and state oil firm PDVSA at the end of January to cut off a cash lifeline for Nicolas Maduro and his regime, after Washington recognized opposition leader Juan Guaidó as the legitimate interim president of the Latin American country sitting on the world’s largest crude oil reserves.
Venezuela’s crude oil production has been plunging over the past two years, due to the rampant economic crisis and years of underinvestment and mismanagement in the oil industry. Still, before the sanctions at the end of January, the U.S. was the top paying customer of Venezuela’s oil, with oil revenues being pretty much the only hard currency income the country gets these days. Related: Why No One Is Interested In Building EV Infrastructure
In 2018, Venezuela was the third largest supplier of crude oil to the U.S., after Canada and Saudi Arabia, according to the EIA’s preliminary weekly data for the top 10 importing countries. Although Venezuela held a 7.8-percent share of the supply to the U.S. in 2018, in the week ending March 15, its exports to the U.S. were zero, compared to 506,000 bpd in the same week last year.
Even after the sanctions were imposed in January, some shipments have trickled in because they were already on tankers off the U.S. Gulf Coast, Ryan Fitzmaurice, energy strategist at Rabobank, told CNN Business’ Matt Egan, but noted that he expects U.S. imports from Venezuela to stay at zero. This would be an issue for U.S. refiners which need the type of heavy oil that Venezuela pumps and would find it difficult to replace it, according to Fitzmaurice.
Yet, Gary Heminger, chairman and chief executive officer at the largest U.S. refiner Marathon Petroleum Corp, said last week that the sanctions have not had a significant impact on the company’s operations, noting that most of the U.S. refiners have been reducing purchases of Venezuelan oil for some time.
By Tsvetana Paraskova for Oilprice.com
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