Venezuela ships more oil to US in July vs June, but less than yr ago

(Reuters) — Venezuela's PDVSA and its joint ventures last month shipped 638,325 bpd of crude to the United States, a 30% increase over June due to larger sales of upgraded oil, according to Thomson Reuters trade flows data.

Photo courtesy of PDVSA.
Photo courtesy of PDVSA.

Venezuelan crude output has declined this year to its lowest point in 27 yr due to a lack of investment and payment delays to oil service firms, affecting exports to customers in key markets including the United States.

Even though the volume of crude sent to the United States in July was larger than the previous month, it was 22% below the same month in 2016.

The main US receiver of Venezuelan crude last month was refiner Valero Energy, followed by PDVSA's refining unit in the United States, Citgo Petroleum.

PDVSA earlier this year signed a refinancing agreement with Russian energy giant Rosneft that has diverted more oil to that firm, and fewer volumes to Citgo.

But Citgo has requested more upgraded crude from joint ventures between PDVSA and its foreign partners in the Orinoco Belt, which has partially compensated for lower supplies from its parent company. Upgraded oils are those that have been treated at special facilities built to process extra heavy crude from Venzeuela's largest oil-producing region.

Another prominent buyer of Venezuelan crude in the United States, refining firm Phillips 66, did not receive crude supplies from PDVSA last month, according to the data.

US-based PBF Energy, Marathon Petroleum, Valero and Phillips 66 have reduced their purchases of heavy oil in recent weeks due to less barrels available from Venezuela and other OPEC producers, which is narrowing spreads between heavy Latin American crudes and lighter grades.

Reporting by Marianna Parraga; Editing by Tom Brown

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