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3 Jun, 2020 10:45

Venezuela’s oil exports crash to 17-year low under tightening US sanctions

Venezuela’s oil exports crash to 17-year low under tightening US sanctions

Crude supplies from Venezuela nosedived in May to their lowest level since 2003 after two Mexican firms that acted as intermediaries for sales stopped receiving oil, having been blacklisted by the United States.

Refinitiv Eikon data and internal shipping documents from Venezuelan state-run energy company PDVSA showed that exports plunged 50 percent in May compared to the average during January through April. PDVSA’s schedule for June shows little change from May, with only three crude cargoes assigned to buyers so far and three more waiting for nominations.

PDVSA and its joint ventures exported 451,935 barrels per day (bpd) of crude and fuel in 18 cargoes last month, according to documents seen by Reuters.

The two Mexican companies that had been delivering Venezuelan crude to the market since late 2019 (by exchanging around 30 million barrels for water trucks in an oil-for-food agreement) said in a statement they were targets of an international political campaign, driven by Washington.

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Statistics showed that the Mexico-based Libre Abordo and related firm Schlager Business Group received over a quarter of Venezuela’s exports in May, at 3.9 million barrels, down from nearly 40 percent or 9.9 million barrels in April.

The US Treasury’s Office of Foreign Assets Control (OFAC) on Tuesday added four vessels chartered this year by Libre Abordo, Schlager Business Group, and Russia’s Rosneft units to transport Venezuelan oil to its list of sanctioned entities.

The Mexican firms have been taking on a larger share of Venezuela’s exports as two units of Rosneft withdrew from trading earlier this year as US sanctions tightened.

READ MORE: Last tanker in Iranian flotilla reaches Venezuela, outmaneuvering US sanctions

Caracas, which is almost entirely dependent on its oil revenues, has condemned the sanctions, calling them economic warfare and an attempt by the US government to take control of the global oil market. The country’s Foreign Minister Jorge Arreaza has accused Washington of violating human rights and freedom of trade, and said the pressure on the Mexican firms was proof of the “illegal” character of the US sanctions regime.

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