• 5 minutes China Faces Economic Collapse
  • 8 minutes ZeroHedge: Oil And Gas Bankruptcies To Accelerate As $137 Billion Debt Matures Over Next Two Years
  • 11 minutes Trump Will Win In 2020
  • 14 minutes Oil Production Growth In U.S. Grinds To A Halt
  • 2 hours The Belt & Road Initiative: A Wolf in Sheep's Clothing?
  • 22 mins Drone attacks cause fire at two Saudi Aramco facilities, blaze now under control
  • 4 hours How OPEC and OECD play their role in setting oil price in light of Iranian oil sanction ?? Does the world agree with Iran's oil sanctions ???
  • 2 hours Cost of oil
  • 3 hours Democrats and Gun Views
  • 11 hours Swedish Behavioral Scientist Suggests Eating Humans to ‘Save the Planet’ from Climate Change. What could possibly go wrong?
  • 12 hours Trump Orders Biofuel Boost
  • 16 hours Buy Oil Monday?
  • 7 hours Iran says tanker oil sold at sea, buyer sets destination
  • 15 hours Used Thin Film Solar Panels at 15 Cents per Watt
  • 12 hours “Who’s going to bail out the Central Banks?”
  • 2 hours US and China are already in a full economic war and this battle for global hegemony is a little bit frightening
  • 15 hours Green New Deal Preview in Texas Town
Alt Text

Yergin: Expect Extreme Volatility In Oil Markets

Supply and demand issues and…

Alt Text

Oil Markets Face Serious Risk Of New Supply Crunch

Slowing global economic growth has…

Irina Slav

Irina Slav

Irina is a writer for Oilprice.com with over a decade of experience writing on the oil and gas industry.

More Info

Premium Content

U.S. Sanctions To Halve Venezuela’s Oil Rig Count

A U.S. sanction waiver expiry later this year could see the number of drilling rigs in Venezuela’s Orinoco Belt slashed by half, putting additional pressure on Caracas by further reducing already low oil production rates.

Bloomberg reports that the sanction waivers that Washington granted U.S. companies still operating in the sanction-hit country are due to expire in late October. These are extended waivers that originally expired earlier this year but the government decided to extend them for three more months. The companies involved, however, had asked for six months, which is not a good sign for the prospect of any further extensions.

“Almost half the rigs are being run by the Yanks, and if the window shuts down on this in two months, then that’s really going to hurt Venezuela unless the Russians and the Chinese come in,” an analyst with consultancy Caracas Capital Markets told Bloomberg.

Among the U.S. companies operating in Venezuela are Chevron, Halliburton, Schlumberger, and bankrupt Weatherford. If they all stop drilling new wells, production of crude in Venezuela would drop sharply: new wells need to be drilled continuously just to maintain current production.

For the U.S. companies, this would mean further writedowns, after a total US$1.4 billion in writedowns on Venezuelan operations since 2018.

Yet it is quite possible that China and Russia will step in and help Caracas. Earlier this month, the news emerged that a Chinese company had sealed a deal with PDVSA to repair its refineries. PDVSA will pay for the services in oil products.

Besides Chinese companies, Russian ones are also bound to expand their presence in Venezuela if U.S. sector players are forced to move out. This is hardly the end result of the sanctions that the Trump administration had in mind, but it might end up being a side effect.

By Irina Slav for Oilprice.com

More Top Reads From Oilprice.com:




Download The Free Oilprice App Today

Back to homepage



Leave a comment
  • Lee James on August 24 2019 said:
    I seriously wonder about Trump's program of economic warfare. Sanctions hurt ordinary citizens. Sanctions force countries to embrace other countries in trade. If we are the only country imposing sanctions, "we lose."

Leave a comment




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