Venezuela-U.S. oil supply deal to hit $2 billion by end of February – U.S. energy secretary

By Sheila Dang

Sales within a key oil supply deal between Venezuela and the United States are expected to reach $2 billion by the end of this month, U.S. Energy Secretary Chris Wright told reporters in Texas on Thursday.

The United States seized control of Venezuelan oil exports shortly after American forces captured President Nicolas Maduro in early January, with the proceeds going to a fund overseen by the United States in Qatar.

Since then, trading companies Vitol and Trafigura have been handling the majority of the OPEC country’s oil under the agreement, while partners of the Venezuelan state oil company PDVSA, including Chevron, are ramping up production and shipments.

At the beginning of February, Mr. Wright forecasted that the country’s oil sales would reach $5 billion within a few months.

The increase in exports is allowing Venezuelan crude and fuel to re-enter markets that had not seen them for months or even years. Other customers in Asia and Europe are in negotiations to import soon, with around 40 million barrels expected to be sold by the end of February at about $50 per barrel, Mr. Wright stated. The initial goal of the pact was to sell between 30 and 50 million barrels, as previously announced by U.S. President Donald Trump.

“Most of this oil will go here, on the American Gulf Coast, but also to India, Asia, and Europe,” Mr. Wright said. “Every barrel produced will be sold, it’s just a matter of where.”

Independent Chinese refineries that were previously buying sanctioned oil can now purchase Venezuelan crude on the open market, Mr. Wright noted. Trump stated that the oil shipments would only be sold at market prices.

Mr. Wright also mentioned that millions of barrels of Venezuelan oil currently stored in Venezuelan waters are being sold off.