• 5 minutes 'No - Deal Brexit' vs 'Operation Fear' Globalist Pushback ... Impact to World Economies and Oil
  • 8 minutes China has *Already* Lost the Trade War. Meantime, the U.S. Might Sanction China’s Largest Oil Company
  • 12 minutes Will Uncle Sam Step Up and Cut Production
  • 2 hours Maybe 8 to 10 "good" years left in oil industry * UAE model for Economic Deversification * Others spent oil billions on funding terrorism, wars, suppressing dissidents * Too late now
  • 8 hours Russia Accuses U.S. Of Stoking Tensions With Missile Test
  • 7 hours OPEC will consider all options. What options do they have ?
  • 2 hours Recession Jitters Are Rising. Is There Reason To Worry?
  • 6 hours CLIMATE PANIC! ELEVENTY!!! "250,000 people die a year due to the climate crisis"
  • 3 hours TRUMP'S FORMER 'CHRISTIAN LIAISON' SAYS DEEPWATER HORIZON DISASTER WAS GOD'S PUNISHMENT FOR OBAMA ISRAEL DIVISION
  • 11 hours With Global Warming Greenland is Prime Real Estate
  • 6 hours What to tell my students
  • 2 hours NATGAS, LNG, Technology, benefits etc , cleaner global energy fuel
  • 21 hours Domino Effect: Rashida Tlaib Rejects Israel's Offer For 'Humanitarian' Visit To West Bank
  • 19 hours In The Bright Of New Administration Rules: Immigrants as Economic Contributors
  • 15 hours Get First Access To The Oilprice App!
  • 4 hours Flaring is at Record Highs in Texas
Alt Text

Can Oil Markets Withstand Recession Fears?

The trade war escalation combined…

Alt Text

Oil Markets Dominated By Bearish Sentiment

With the latest trade war…

Alt Text

Shale Bleeds Cash Despite Best Quarter In Years

The second quarter earnings results…

Matt Smith

Matt Smith

Taking a voyage across the world of energy with ClipperData’s Director of Commodity Research. Follow on Twitter @ClipperData, @mattvsmith01

More Info

Premium Content

Venezuela Is Losing Its Best Oil Buyer

Venezuelan president Nicolas Maduro said this week that PdVSA is willing to retaliate against financial sanctions from the U.S. by suspending oil exports to the country, sending crude to Asia instead.

This seems highly unlikely, given that the U.S. is one of its largest cash-paying customers. China is PdVSA's largest customer in Asia, but it doesn't receive payment for these shipments - it is using crude to pay off its vast debts instead.

We can see in our ClipperData that U.S. imports of Venezuelan crude have been exceedingly steady in recent years, averaging 773,000 bpd in 2014, 792,000 bpd in 2015 and 754,000 bpd in 2016. Steady flows make sense - not only because of the presence of Citgo refineries on the US Gulf Coast, but because Gulf Coast refiners are geared towards refining the heavy crude that Venezuela produces. Proximity is also a key consideration.

Exports this year, however, have dropped considerably, nearly 20 percent below the 3-year average to 629,000 bpd. After a fairly regular first five months of the year, imports have taken a dive since, dropping below 500,000 bpd in November.

This is a result of falling Venezuelan production, which has now dropped below 2 million barrels per day, a near three decade low. It also because U.S. refiners such as PBF Energy have halted buying from the state-run oil company due to both crude quality and credit issues.

(Click to enlarge)

As U.S. imports of Venezuelan crude continue to fall, PdVSA is making sure to send product to as many of its suppliers as possible, at the expense of its own refineries. Deliveries to Citgo's two refineries at Lake Charles and Corpus Christi have dropped to just 38,000 bpd in November, the lowest on our records, after averaging just over 200,000 bpd in each of the last three years.

Related: The Oil Information Cartel Is (Finally) Broken

(Click to enlarge)

Venezuela and Curacao import light crude and naphtha to use as a diluent, mixing it with its heavy crude for exportation. After importing other grades in previous years, PdVSA's Curacao terminal started regularly importing U.S. crude at the start of last year.

It imported (mostly) WTI in every month but one last year, with deliveries averaging 29,000 bpd across the period. But after a solid start to 2017, imports started to sputter in Q2. After an absence of deliveries in both April and May, there was a 500,000 bbl delivery of DSW from Enterprise's Beaumont terminal. This was the last delivery of U.S. crude in the last five months.

Last week we told clients about the Aframax Tulip. It left Enterprise's Beaumont terminal with 500,000 bbls of WTI in mid-May, and has been anchored off Curacao ever since. After waiting there for six months, the vessel left her anchorage last week. It would appear that the owner of the cargo has given up hope that PdDVSA will ever pay for the oil.


(Click to enlarge)

By Matt Smith

More Top Reads from Oilprice.com:




Download The Free Oilprice App Today

Back to homepage


Leave a comment
  • Tony Grimaldi on December 01 2017 said:
    That's major news, that's 2 million bbl per day out of the us storage tanks. They may need to open up the SPR to ease the crunch. I doubt he's bluffing, it was probably in the fine print with the loan from the Kremlin.
  • CHIEF WIGGIMS on December 03 2017 said:
    Why doesn't the US ask Venezuela if it wants to become a US state. They'd be a lot farther ahead and it's evident they can't obtain wealth on their own.
  • john on December 18 2017 said:
    Like Puerto Rico, maybe ?

Leave a comment




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