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The Past and Potential of Venezuela's Oil Sector, and What It Means for Canada
Venezuela’s extra-heavy crude output is limited by underinvestment and technical challenges despite partial U.S. sanction relief enabling modest exports and diluent shipments.
- The U.S. Department of Energy said Wednesday it is selectively rolling back sanctions to allow Venezuelan crude back into global markets, following earlier easing that let Chevron resume exports and coinciding with plans to sell 30 to 50 million barrels.
- Venezuela's oil is extra-heavy and requires U.S. diluent shipments for blending, while budget shortfalls, degraded infrastructure and unpaid arbitration awards hinder production growth.
- Venezuela holds 303 billion barrels, about 17% of reserves, produces 1.14 million barrels daily, and Rystad Energy estimates $50 million of investment is needed to keep output flat.
- Immediate consequences include Western Canada Select prices weakening recently while U.S. Gulf Coast refineries are configured for heavy oil, with little risk of Venezuelan crude replacing Canadian exports to Midwest refiners.
- U.S. supermajors' return remains uncertain, and Canada produced a record 5.13 million barrels a day, sending about 400,000 barrels daily to the Gulf Coast market in recent years.
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17 Articles
17 Articles
The Center Square+2 Reposted by 2 other sources
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Total News Sources17
Leaning Left5Leaning Right2Center3Last UpdatedBias Distribution50% Left
Bias Distribution
- 50% of the sources lean Left
50% Left
L 50%
C 30%
R 20%
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