Venezuela oil exports stable in March despite sanctions, blackouts -data

Capitan Investment

02/04/2019 19:27

By Marianna Parraga
    April 2 (Reuters) - Venezuela's state-run energy company,
PDVSA, kept oil exports near 1 million barrels per day in March
despite U.S. sanctions and ongoing power outages that crippled
its main export terminal, according to PDVSA documents and
Refinitiv Eikon data.
    The OPEC member stabilized exports in March after shipments
fell about 40 percent in February from the month before, in the
immediate aftermath of the United States announcing it would
impose sanctions on oil sales to choke off main source of
revenue for the government of socialist President Nicolas
Maduro.
    The United States and many Western governments have
recognized Venezuelan opposition leader Juan Guaido as the
country's rightful leader, after Maduro won an election last
year that was widely considered a sham.
    March's exports of 980,355 barrels per day (bpd) of crude
and fuel were only slightly less than February's shipments of
990,215 bpd, according to the documents seen by Reuters and the
Refinitiv Eikon data.
    U.S. restrictions on Venezuelan exports will tighten further
in May, when the grace period for winding down purchases expires
for importers of Venezuelan oil who use U.S. subsidiaries or the
U.S. financial system for transactions.
    U.S. President Donald Trump is considering imposition of 
sanctions on companies from other countries that do business
with Venezuela, White House  national security adviser John
Bolton told Reuters TV on Friday.
    Most oil shipments in February and March were destined for
Asia. Until the sanctions, the United States was Venezuela's
largest crude buyer.  urn:newsml:reuters.com:*:nL1N20M25E
    "Given the new set of challenges that landed on PDVSA's lap,
we were surprised to see a rebound in exports amid the
nationwide power blackouts," said Samir Madani, co-founder of
TankerTrackers.com, a service that tracks oil shipments and
storage.
    Exports dipped below 650,000 bpd during the blackouts,
TankerTrackers estimates.
    Two massive power outages in March caused Jose port, the
country's largest crude terminal, to shut for at least six full
days, according to the Eikon data.
    PDVSA was able, however, to offset delays caused by
blackouts by loading larger vessels bound for Asia. Shipping
data shows the company plans to do the same again in April.
    Cargoes sent to India, China and Singapore - a hub for
storage and re-exports - made up 74 percent of total exports in
March, compared with almost 70 percent in February.
    Exports to Europe accounted for 17 percent of the total,
versus 22 percent the previous month. 
    PDVSA also continued exporting oil to Maduro's ally Cuba. At
least seven small cargoes were sent from its ports in March,
totaling 65,520 bpd of crude and fuel, according to the data.
    Guaido last month said shipments to Cuba should be halted.
But PDVSA, controlled by a military leadership loyal to Maduro,
has continued exports to the island.
    The state-run company did not respond to a request for
comment.
    Venezuela's oil production once surpassed 3 million bpd, but
years of mismanagement and corruption caused that output to
dwindle to barely 1 million bpd. The reduction in oil revenue 
has led the once-prosperous nation of 30 million into years of
recession and created conditions that led to hyperinflation.
Millions have fled the country and many who remained cannot
afford food or basic goods.
    Sanctions have made it difficult for PDVSA to take payment
for its exports, said a PDVSA source, who did not want to be
identified for fear of retaliation.
    "The largest problem is not to load and ship the vessels,"
the source said, declining to be identified due to the
sensitivity of the matter. "It is to get paid." 
    
    INDIA REMAINS TOP DESTINATION
    India was once again Venezuela's main destination for
exports in March with a third of total cargoes sent to
refineries operated by Reliance Industries  RELI.NS  and Nayara
Energy  ESRO.M3 .
    U.S. imports of Venezuelan oil have dropped to zero since
mid-March due to sanctions, according to the U.S. Energy
Information Administration.  urn:newsml:reuters.com:*:nL1N2171XY
    The largest individual recipient of Venezuelan barrels last
month was China National Petroleum Corp (CNPC) and its
subsidiaries with some 234,000 bpd, followed by Russia's Rosneft
 ROSN.MM , which received 214,000 bpd, according to the data.
New customers including trading firms Sahara Energy  SAH.V  and
MS International also received access to Venezuelan crude.
    Rosneft has increased its share of Venezuelan oil shipments
since sanctions mainly for reselling to refiners. Venezuela's
oil minister, Manuel Quevedo, last month traveled to Moscow to
negotiate larger sales of Venezuelan oil to Russian
companies. urn:newsml:reuters.com:*:nL8N2153Q8
    The Russian company has also boosted fuel supplies to
Venezuela, according to the data. Venezuela imported 184,500 bpd
of fuel last month, with the largest portion provided by
Rosneft, followed by cargoes sent by Reliance and Spain's Repsol
 REP.MC .  urn:newsml:reuters.com:*:nL5N20F2CO
    Following U.S. pressure, Reliance turned to selling fuel to
Venezuela from India and Europe to circumvent sanctions. Repsol
in March swapped gasoline and other fuel for Venezuelan crude as
part of an agreement to collect on dividends owed it by PDVSA.
 urn:newsml:reuters.com:*:nL1N21712O  urn:newsml:reuters.com:*:nL1N20W089

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GRAPHIC: Venezuela's exports by destination in 2018    https://tmsnrt.rs/2HU81FY
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 (Reporting by Marianna Parraga
Editing by David Gaffen, Simon Webb and Steve Orlofsky)
 ((marianna.parraga@thomsonreuters.com; +5255 5282 7159; Reuters
Messaging: marianna.parraga@thomsonreuters.com))