The United States is reporting an unprecedented surge in Venezuelan oil exports, with estimates suggesting nearly half of the country’s total production is now flowing into the US market. According to a senior US official, Kyle Haustveit, this has translated to over 500,000 barrels per day (bpd) of oil moving from Venezuela to the US, a figure that has steadily increased over the past seven months since the Washington abduction and subsequent installation of an interim government. This shift is driven in part by the refineries’ specialized design, built to process the heavy, sour crude extracted from Venezuela.
Specifically, Under Secretary of Energy Kyle Haustveit explained that the US Energy Information Administration estimates Venezuela possesses 303 billion barrels of proven oil reserves, representing approximately 17% of the global total. However, decades of underinvestment and sanctions have severely limited Venezuelan production, with current output hovering around 1 million barrels per day, and a significant 135,000 barrels per day going to the US.
Haustveit highlighted the significant financial benefits this arrangement offers. The US is sending over 100,000 bpd of naphtha to Venezuela, where it’s blended with heavier crude, further bolstering Venezuelan refining capacity. The US is also actively engaging in the scaling up of Venezuelan production, with the state-owned PDVSA company reporting a 19.7% increase in crude output this year. Martinez, VP of PDVSA, stated that Venezuela’s crude output would reach 1.245 million bpd by the end of August, with exports up 19.7% this year, supplying 5.4% more fuel domestically.
The US government’s involvement extends beyond simply facilitating imports. Secretary of State Marco Rubio recently stated that the funds from Venezuelan oil sales will be deposited into an account overseen by Washington, with the administration specifying up-front what funds can not be used for. This move comes after President Trump repeatedly asserted that the US would run Venezuela and tap its oil reserves, advocating for a ‘money control’ strategy by Donald Trump. The administration has, however, been notably silent regarding the actual financial impact of these sales.
In April, the State Department issued a $3 billion disbursement to Venezuela, a figure that Trump later stated was higher. While the administration has largely avoided public discussion of the precise amount of oil sold and revenue generated, the situation has become increasingly complex. A recent report by the Financial Times, in July, indicated that the US has collected over $13 billion in revenue from Venezuelan oil sales this year. The report further noted that while the administration has framed its control of Venezuelan oil exports as beneficial for both countries, it has not publicly disclosed the exact amount of oil sold, how much revenue has been collected, or how it has been utilized.
The Council on Foreign Relations, a think tank, cautioned that the Trump administration’s policy of prioritizing Venezuelan oil sales over oversight risks entrenching a corrupt regime, particularly given the exclusion of opposition and civil society from discussions with the interim government. The opposition, including Nobel laureate Maria Corina Machado, has agreed to a new roadmap calling for elections and political negotiations, aiming to address the country’s future.
The arrangement raises significant geopolitical and economic concerns, potentially reshaping the global energy landscape and impacting Venezuela’s economic stability.
Source: Al Jazeera
