• 3 minutes China has *Already* Lost the Trade War. Meantime, the U.S. Might Sanction China’s Largest Oil Company
  • 7 minutes Saudi and UAE pressure to get US support for Oil quotas is reportedly on..
  • 11 minutes China devalues currency to lower prices to address new tariffs. But doesn't help. Here is why. . . .
  • 15 minutes What is your current outlook as a day trader for WTI
  • 37 mins 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 Long Range Attack On Saudi Oil Field Ends War On Yemen
  • 5 hours Will Uncle Sam Step Up and Cut Production
  • 12 hours In The Bright Of New Administration Rules: Immigrants as Economic Contributors
  • 21 hours Domino Effect: Rashida Tlaib Rejects Israel's Offer For 'Humanitarian' Visit To West Bank
  • 20 hours Gretta Thunbergs zero carbon voyage carbon foot print of carbon fibre manufacture
  • 21 hours Continental Resource's Hamm wants shale to cut production. . . He can't compete with peers.
  • 15 hours CLIMATE PANIC! ELEVENTY!!! "250,000 people die a year due to the climate crisis"
  • 1 day NATGAS, LNG, Technology, benefits etc , cleaner global energy fuel
  • 1 day Significant: Boeing Delays Delivery Of Ultra-Long-Range Version Of 777X
  • 2 days Strait Of Hormuz As a Breakpoint: Germany Not Taking Part In U.S. Naval Mission
  • 1 day Why Oil is Falling (including conspiracy theories and other fun stuff)
  • 1 day Trump vs. Xi Trade Battle, Running Commentary from Conservative Tree House
The 5 Hottest Gold Stocks Of 2019

The 5 Hottest Gold Stocks Of 2019

Bullish signs are mounting for…

Oil Prices Crash On Recession Fears

Oil Prices Crash On Recession Fears

Oil prices fell sharply on…

Congressional Hearing: This Is How Far Venezuelan Oil Production Could Fall

Venezuela Protests

Venezuela’s oil production could feasibly fall to just 500,000 barrels per day by year’s end, according to the US State Department’s Special Envoy to Venezuela in a Wednesday hearing on the crisis-stricken Latin American nation on Wednesday.

 The cause for the expected production declines, said Rep. Elliot Abrams, was the impact of US sanctions on Venezuela’s state-run oil company, PDVSA.  

The crisis in Venezuela, of which its floundering oil industry is merely one part,  is “entirely manmade”, according to House Committee on Foreign Affairs Chairman Eliot L. Engel, who is also the Co-Chair of the House Oil and National Security Caucus, a champion for US energy independence, and serves on the Commission for Human Rights, who today did not mince words when he laid blame for the Venezuelan  disaster squarely on Nicolas Maduro’s and Hugo Chavez’s doorstep. Two leaders, Engel said, who “have driven the country off the edge of the cliff.”

In his opening remarks as chairman, Engel went on to definitively dispel the notion that US military intervention in Venezuela could possibly be used in the future, despite what he referred to as President Donald Trump’s “sabre rattling” on the issue, stressing that such action would require Congressional approval, which would never be given.

Despite that preface for Wednesday’s hearing, a heated exchange between Rep. Elliot Abrams and Rep. Ilhar Omar sprung up, with Rep. Omar asking of Abrams, “Yes or no, would you support an armed faction within Venezuela that engages in war crimes, crimes against humanity or geocide if you believe they were serving US interest, as you did in Guatemala, El Salvador, and Nicaragua?” To which Abrams refused to reply.

Related: Oil Rises Despite Rising Oil, Product Inventories

Venezuela’s oil production—which accounts for 95% of the country’s export revenues—is but a shadow of its former glory days of 3 million barrels per day as it was in 1997. By 2017 its production had fallen to 2 million bpd, and by this time last year, Venezuela’s production had fallen again to 1.5 million bpd. 

According to OPEC’s latest monthly oil market report, Venezuela’s production last month fell to 1.1 million bpd.

Depending on what point is being made, one could believe that Maduro and Chavez are responsible for the inexorable production decline in Venezuela, who has hundreds of billions of barrels in oil reserves. One could also believe the US back patting that suggests its new round of US sanctions levied in January on Venezuela is the cause of the reduced oil output by tying the hands of its customers, and by holding back shipments of the essential diluent that Venezuela needs to keep the oil flowing.

Should its oil output indeed sink to 500,000 bpd by the end of this year, customers of Venezuela’s heavy oil, including India and the United States, may find it hard to purchase a suitable heavy substitute, as all oil is not equal.

By Julianne Geiger for Oilprice.com

More Top Reads From Oilprice.com:



Join the discussion | Back to homepage

Leave a comment

Leave a comment

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