Venezuela’s Oil Ministry officials announced a push towards producing 1 million barrels of oil per day, capitalizing on Washington’s recent easing of sanctions. The country’s current output stands at 850,000 barrels per day (bpd), showing a notable increase from October’s production volume of 786,000 bpd.
Key Points:
- Recovery Progress: Venezuelan Oil Ministry officials, including Deputy Oil Minister Erick Perez, highlighted the ongoing recovery in oil production. The country aims to further improve its output, signaling positive momentum for its oil sector.
- Natural Gas Exports: Perez emphasized the prospective commencement of natural gas exports from the Dragon field offshore gas project, a collaboration with Trinidad and Tobago. Negotiations with the government of Trinidad are underway, with Shell participating in the project.
- Sanctions Relief Impact: Since Washington temporarily eased sanctions on October 18, oil traders have been actively purchasing Venezuelan crude. The renewal of licenses for oil services firms on November 16 further strengthened the country’s outlook, extending licenses through May 16, 2024.
- International Providers: Venezuela is in negotiations with international oilfield services firms to enhance its existing assets and ramp up production. The extension of licenses has facilitated discussions with providers to support the country’s efforts to increase oil output.
- Commodity Trading Response: Following the lifting of sanctions, major commodity trading companies swiftly re-entered the Venezuelan oil market. Deals were struck to buy crude from intermediaries approved by Venezuela’s state-owned oil company PDVSA. Notably, Vitol Group, the world’s largest independent oil trader, booked a supertanker to load Venezuelan oil.
- Positive Market Response: Oil traders rushing to buy Venezuelan crude have contributed to the country’s positive outlook. Deals and negotiations with international partners are expected to further boost production and market share.
Summary: Venezuela’s ambitious target of reaching 1 million bpd underscores its determination to regain market share amid eased sanctions. The recent increase in oil production to 850,000 bpd reflects positive strides in the country’s recovery efforts. With negotiations for natural gas exports and collaborations with international partners, Venezuela aims to strengthen its position in the global oil market. The positive response from oil traders and major commodity trading companies further supports the country’s outlook for increased oil output.
