Chevron and Valero Energy are reportedly in discussions to restart the supply of Venezuelan crude oil to Valero’s US refineries, according to a Reuters report, citing sources.
This development follows Chevron’s receipt of a restricted licence from Washington in late July, allowing operations and oil exchanges with Venezuela, a nation currently under US sanctions.
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The permit is subject to strict terms that forbid the allocation of any oil revenue to the regime of Venezuelan President Nicolas Maduro.
The licence, which came as part of a policy shift after a prisoner swap, enables Chevron to resume oil shipments, with the company set to restart deliveries this month, albeit with an initial small volume.
Chevron is awaiting the allocation of cargoes for August delivery from Venezuelan state company PDVSA.
Negotiations between Chevron and Valero include the revival of a ship-to-ship operation off the Caribbean Island of Aruba.
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By GlobalDataThis operation could potentially restart this month, pending mandatory inspections and ongoing vessel contract negotiations, according to one of the sources, the report said.
Before the revocation of Chevron’s licence to operate in Venezuela, the company supplied approximately 50,000 barrels per day (bpd) of Venezuelan heavy crude to Valero’s refineries via Aruba in the first quarter, based on shipping data.
This volume accounted for around 20% of Chevron’s total Venezuelan oil exports during that time frame.
The supply agreement is particularly crucial for Chevron’s second-largest joint venture in Venezuela, Petroboscan, located in the country’s western region.
The heavy Boscan crude produced by Petroboscan has faced storage limitations, leading to production cuts in the past. Resuming the supply deal would address these challenges.
