Venezuela will begin exporting a new medium crude blend this month as part of a marketing strategy to avoid a collapse of its revenue-generating oil sales once licenses on the U.S.-sanctioned OPEC member expire next month, trading documents showed.
Washington in March revoked a handful of licenses it had granted in recent years for partners and customers of state company PDVSA PDVSA.UL to take cargoes of Venezuelan crude bound for Spain, Italy, India and the U.S., including to Chevron CVX.N, Repsol REP.MC, Eni ENI.MI, Maurel & Prom MAUP.PA and Reliance Industries RELI.NS.
The U.S. Treasury Department gave the companies until May 27 to wind down operations in Venezuela and complete shipments.
Since the announcement, PDVSA has been doing preparations to reorganize oil production, upgrading, blending and exports, especially at projects operated by the joint ventures hit by the license cancellations.
One of the measures is the production and sale of “Blend 22,” a new crude grade coming from PDVSA’s Western fields.
PDVSA has in recent months increased output and storage of Blend 22 aiming to lure customers in Europe and Asia that have an appetite for medium sour grades to refine. The Venezuelan company is actively marketing the crude so once the licenses expire, it can send it to other destinations, including China, sources said.
The first two export cargoes of Blend 22 were allocated to France’s Maurel & Prom from La Salina port in Western Zulia state, as part of a swap for heavy naphtha delivered to PDVSA this month that was authorized since last year by a U.S. license, according to documents seen by Reuters.
The vessels that will carry the crude, which arrived in Venezuelan waters earlier this month, were chartered by trading house Vitol VITOLV.UL. The first tanker is scheduled to carry some 250,000 barrels, one of the documents showed.
Paris-based M&P, which is majority-owned by the Indonesian government, in late March said the license had been revoked by the U.S. Treasury with a May 27 deadline for completing transactions.
PDVSA and M&P did not reply to requests for comment. Vitol could not immediately be reached for comment. It was not immediately clear which customers would take the new crude grade after the French firm.
PDVSA also is trying to refine more crude domestically to avoid a fuel crisis as the ones that have prompted day-long lines at stations in previous years of hardening U.S. sanctions.
Venezuela’s exports of crude and fuel increased about 11% to some 770,000 barrels per day (bpd) last year, the highest average since 2019 when energy sanctions were first imposed by Washington.
However, U.S. President Donald Trump’s harder stance on the oil producer, which also includes the imposition of tariffs on Venezuela’s oil buyers, is expected to stop the rise in exports if the countries cannot find solutions to present issues, including migration and democracy.
Venezuela has declared a state of economic emergency in response to U.S. sanctions and tariffs. Officials have rejected the sanctions, saying they amount to an “economic war.”
Source: Reuters
