China moves to restart oil trade with Venezuela

Venezuela

CARACAS, November 6, 2023 – Chinese NOC PetroChina has proposed to buy up to 8 million boe per month from state-run Petróleos de Venezuela (PDVSA), Reuters reported on Thursday.

According to Reuters’ sources, the buyer has offered cash payment for around 260,000 bopd through its joint ventures with PDVSA.

Before sanctions PetroChina was importing six 2-million-barrel cargoes of Venezuelan crude per month.

Cost of the proposed transaction was not disclosed.

In October 2023 the USA significantly eased sanctions on Venezuela’s oil sector due to guarantees agreed by the local government for an election in the South American country in 2024.

The new licence allows Venezuela to produce, sell and export oil for six months with no limitations.

It also lifts a secondary trading ban on some Venezuelan sovereign bonds and PDVSA’s debt and equity.

A sanction to halt trade on the primary Venezuelan bond market remains in place.

A deal was previously reached between the current Venezuelan administration and the opposition that allows each party to choose its 2024 electoral candidate.

However, US Secretary of State Antony Blinken has given Venezuela’s President Nicolás Maduro until November to lift bans on further opposition runners in the election and release political prisoners and wrongfully detained American citizens.

Earlier in October 2023, Trinidad and Tobago began price negotiations for natural gas imports from Venezuela following signing a profit-sharing agreement in September 2023 to jointly develop the Dragon field.

The Dragon field, which sits in Venezuela’s territorial waters, is believed to contain 4.2 tcf (118.94 bcm) of natural gas.

Venezuela currently produces around 780,000 boepd with a target to raise production to 1 million boepd in 2023.

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