US, Venezuela in Talks to Restart Venezuelan Oil Exports to America Amid Sanctions

Venezuelan and U.S. officials are discussing exporting Venezuelan crude to refiners in the United States, five government, industry, and shipping sources told Reuters on Tuesday.

Venezuela has millions of barrels of oil loaded on tankers and in storage tanks that it has been unable to ship due to a blockade on exports imposed by U.S. President Donald Trump since mid-December. The blockade was part of rising U.S. pressure on the government of Venezuelan President Nicolas Maduro that culminated in U.S. forces capturing him over the weekend.

A deal to sell the stuck crude to refiners in the United States would redirect them from China, which has been Venezuela’s top buyer in the last decade, and especially since the United States imposed sanctions on companies involved in oil trade with Venezuela in 2020. State oil firm PDVSA has already had to cut production due to the embargo, because it is running out of storage for the oil. If PDVSA does not find a way to export oil soon, it would have to cut production more, one of the sources said.

The White House, Venezuelan government officials, and PDVSA did not immediately comment.

U.S. refineries on the Gulf Coast can process Venezuela’s heavy crude grades and were importing some 500,000 barrels per day (bpd) before Washington first imposed energy sanctions on Venezuela.

It was not immediately clear how sanctioned PDVSA would obtain proceeds from the oil sales.

(INPUTS FROM REUTERS)