The U.S. government may be considering sanctions against the Venezuelan government, Reuters reports. That would take the form of restricting trade with national oil producer PdVSA, though the considerations by the administration of President Donald Trump are still at an early stage.
Panjiva data shows that U.S. and Chinese imports of Venezuelan oil amounted to $15.9 billion in the 12 months to April. They increased in April by 97.1% on a year earlier due in part to a 23.3% rise in the benchmark price of oil. The U.S. accounted for 61.4% of the total over the past 12 months. Removal of the U.S. sales of oil – assuming China does not take up the shortfall – would have moved the Venezuelan trade surplus of $6.7 billion to a $2.6 billion deficit in the 12 months to March 31.
Source: Panjiva
One issue for the U.S. would be to make up the oil supplies. Venezuela accounted for 6.1% of U.S. oil imports in the 12 months to March 31, as outlined in Panjiva research of May 15. Refiners including Valero and Chevron would need to find alternative suppliers, though these could be both domestic as well as overseas. One constraining factor though is that Venezuelan oil is a “ heavy” type, whereas many U.S. supplies are “lighter”. That may limit the choices for some refiners.
Source: Panjiva