México

Guyana

Trinidad
& Tobago




Very usefull links



PW
Bookstore





News links

AP

AFP

Aljazeera

Dow Jones

Oil price

Reuters

Bloomberg

Views and News
from
Norway

 

 

 

Crude shift setup more complications to US-Venezuela actions

 


 

By Argus

HOUSTON

Petroleumworld 01 23 2019

The US Gulf coast's need for heavy crude is giving Washington pause over whether to impose oil sanctions on Venezuela

An emboldened Venezuelan opposition and tighter global heavy crude supplies are complicating the options available to the US in responding to President Nicolas Maduro's disputed second term in office.

Refiners have held renewed discussions with White House officials this month over the disruptions that potential sanctions could have on the flow of oil from an increasingly autocratic Venezuela to mostly US Gulf coast facilities. Oil sanctions have featured in these discussions for almost two years.

Venezuela's very heavy sour crude feeds some of the US Gulf coast's most complex refineries, providing a tranche of baseload supply that booming US light crude production cannot easily replace. The latest sanctions talks come as alternative heavy crude supplies are proving harder to come by, with Opec and its non-Opec allies reducing exports. Oil sanctions "would ensure that our US Gulf coast refiners that are optimised to run heavy crude will not have the same access to it," refiner and petrochemicals association AFPM vice-president of government relations Geoff Moody says.

Venezuela accounted for over 28pc of Gulf coast heavy crude imports more than any other country in 2017, the most recent full year for which there are EIA data. Venezuelan state-owned PdV's US refining subsidiary Citgo takes the largest share of these exports, followed by US independent refiner Valero, Chevron and PBF. Mexico supplied more than 27pc, and Canada the largest overall crude exporter to the US 19pc of the Gulf coast diet. But the Venezuelan share fell to slightly below 24pc or roughly 490,000 b/d in January-October last year, the most recent data show, with Mexico supplying 29pc and Canada 23pc.

Refiner access to heavy crude alternatives to Venezuelan shipments has fallen sharply over the past two months. The Opec/non-Opec cuts programme that began this year aims to reduce global crude supplies by 1.2mn b/d, with the reductions mainly affecting medium and heavy sour grades, increasing competition for replacements from Asia-Pacific and other heavy crude buyers.

Heavy losses

Canadian heavy WCS prices have risen sharply since December when Alberta's provincial government announced plans to begin capping production to draw down high inventories and mitigate pipeline constraints from the province. Prices this month have firmed to a $9/bl discount to benchmark WTI at the Cushing hub in Oklahoma, compared with a nearly $25/bl discount a year earlier. An end to the Canadian pipeline constraints remains years away, while falling output in Mexico means that it is unlikely to have additional heavy crude to export.

Maduro's inauguration this month for a second term that US officials describe as illegitimate has emboldened domestic opposition to his rule. The opposition-controlled national assembly is planning a nationwide protest on 23 January aimed at compelling Maduro to resign. The outcome of the protests may well determine whether Washington imposes sanctions on Venezuela's oil sector.

The US is not yet ready to withdraw formal recognition from the Maduro government and transfer it to the assembly a step with legal ramifications, among other things, for the ownership of Venezuelan assets in the US and control over revenue derived from oil exports. It has already imposed sanctions on Maduro and other high-ranking Venezuelan officials, in addition to financial sanctions. But the most effective tool in the US arsenal sanctions on imports of Venezuelan oil to the US or exports of US naphtha and oil to Venezuela is also one that US officials have been unwilling to adopt, out of fear of an immediate collapse of the Venezuelan economy for which the US would be blamed.


________________________


We invite you to join us as a sponsor.

Circulated Videos, Articles, Opinions and Reports which carry your name and brand are used to target Entrepreneurs through our site, promoting your organization’s services. The opportunity is to insert in our stories pages short attention-grabbing videos, or to publish your own feature stories.

________________________

 

Story from Argus Media

argusmedia.com 01 22 2019

Hit your target - Advertise with us

PW 300.000 plus request per week

Copyright© 1999-2019 Petroleumworld or respective author or news agency. All rights reserved.

We welcome the use of Petroleumworld™ (PW) stories by anyone provided it mentions Petroleumworld.com as the source.

Other stories you have to get authorization by its authors. Internet web links to http://www.petroleumworld.com are appreciated.

Petroleumworld welcomes your feedback and comments, share your thoughts on this article, your feedback is important to us!

We invite all our readers to share with us
their views and comments about this article.

Write to editor@petroleumworld.com

By using this link, you agree to allow PW
to publish your comments on our letters page.

Any question or suggestions,
please write to: editor@petroleumworld.com

Best Viewed with IE 5.01+ Windows NT 4.0, '95,
'98,ME,XP, Vista, Windows 7,8,10 +/ 800x600 pixels

Twitter: @petroleumworld1


 

TOP

Contact: editor@petroleumworld.com,

Editor & Publisher: Elio Ohep/
Contact Email: editor@petroleumworld.com

CopyRight © 1999-2019, Paul Ohep F. - All Rights Reserved. Legal Information

PW in Top 100 Energy Sites

CopyRight©1999-2019, Petroleumworld   / Elio Ohep - All rights reservedThis site is a public free site and it contains copyrighted material the use of which has not always been specifically authorized by the copyright owner.We are making such material available in our efforts to advance understanding of business, environmental, political, human rights, economic, democracy, scientific, and social justice issues, etc. We believe this constitutes a 'fair use' of any such copyrighted material as provided for in section 107 of the US Copyright Law. In accordance with Title 17 U.S.C. Section 107, the material on this site is distributed without profit to those who have chosen to view the included information for research, information, and educational purposes. For more information go to: http://www.law.cornell.edu/uscode/17/107.shtml. If you wish to use copyrighted material from this site for purposes of your own that go beyond 'fair use', you must obtain permission fromPetroleumworld or the copyright owner of the material.