U.S. Seizes Control of Venezuelan Oil Sales as China Scouts Canadian Crude

Overview

• The Trump administration said it will control Venezuelan oil sales for an indefinite period, retain proceeds, and restrict purchases under that scheme to U.S. products.
• Chinese refiners have stepped up inquiries for Canadian heavy crude since Nicolás Maduro’s capture, with operators citing an $8 to $9 per barrel premium over Venezuela’s Merey and faster voyages from Vancouver to Qingdao.
• Roughly 22 million barrels of Venezuelan crude are currently stored on tankers off Malaysia and China, providing a short-term supply cushion estimated to last up to two months.
• Japan reports no current imports of Venezuelan crude and last bought in 2017, as Idemitsu’s chief says the oil’s heavy, high-sulfur quality would be difficult to process without refinery investments.
• Analysts note Venezuela’s output has fallen far below its reserves potential and that significant increases would require time and capital, though U.S. Gulf Coast refineries historically imported about 500,000 barrels per day before sanctions.