The easing of oil sanctions by the United States against Venezuela included an agreement for Petróleos de Venezuela (PDVSA) to send crude oil to Europe and for income was received by the companies Eni and Repsol, with which the Venezuelan state company has debts. However, Venezuela suspended shipments.
(Also read: Venezuela, the thorny path of normalizing relations)
The stoppage is due to the fact that PDVSA is asking both companies to provide fuel, as confirmed by internal sources to local media.
Oil experts agree with the reasons for the suspension and consider that this reveals the legal insecurity that the oil company offers to foreign investment.
The expert on oil issues, Rafael Quiroz, told EL TIEMPO that PDVSA’s debts exceed 13 billion dollars according to the unofficial data they have been able to collect, since the industry has not published its financial statements since 2016.
“PDVSA reveals the seams of the financial situation, that it has no liquidity and urgently needs cash and therefore resorts to ignoring an agreement that it had reached,” insists Quiroz, recalling that the US had authorized the transfer of the barrels to Europe to repay the debts with Eni and Repsol, not so that money could enter PDVSA.
PDVSA reveals the seams of the financial situation, which has no liquidity
If Venezuela manages to change the conditions of the agreement, it is possible that it will reactivate operations in the Orinoco Oil Belt, since diluents are needed to process this extra-heavy crude.
According to PDVSA documents, Eni has received 3.6 million barrels of Venezuelan crudewhich was later delivered to Repsol due to its refining capacity.
“Now Maduro, handsome and supported, has the luxury of suspending oil shipments to Europe. He no longer wants to export oil to pay debts, he wants dollars in cash,” Ramón Muchacho, a former Venezuelan mayor in exile, believes.
For Muchacho, this behavior, in addition to showing how the Venezuelan president acts without brakes, also shows how the opposition has to understand that the US is pleasing Maduro and therefore, the political negotiation is no longer with the opponents.
“It is better to accept reality as it is, and consider that chapter closed, instead of living begging Maduro to return to the negotiating table,” he says.
production drop
According to the monthly report of the Organization of Petroleum Exporting Countries (Opep), for July Venezuela registered a drop in its production, being the lowest of the year at 661,000 barrels per day, that is, a decrease of 49,000 barrels and a variation of 7 percent with respect to the previous month, whose production closed at 710,000.
At the end of 2021, production picked up and reached 900,000 barrels per day, according to reports from representatives of the Maduro administration, which has promised more than 1,000,000 barrels per day.
According to OPEC reports, the price of Venezuelan crude oil also fell. In July it was 84.72 dollars a barrel, but in June the price was 92.25 dollars, although compared to the previous year the figure is satisfactory. In 2021, the price was 47.33 dollars per barrel.
ANA RODRIGUEZ BRAZON
WEATHER CORRESPONDENT
CARACAS
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