Venezuela’s state oil company PDVSA has taken control of crude exports previously handled by Chevron, signaling a breakdown in the uneasy oil trade arrangement between Washington and Caracas.
Earlier this month, PDVSA shipped 920,000 barrels of Boscan heavy crude—traditionally exported only by Chevron—to Malaysia, a known transfer point for crude ultimately bound for China. The oil came from the Petroboscan joint venture between Chevron and PDVSA, Reuters reported, citing shipping data and documents.
The shift follows PDVSA’s abrupt cancellation of Chevron’s scheduled May shipments, accusing the U.S. oil giant of failing to make payments. This comes despite Chevron still holding a valid U.S. license to operate in Venezuela until May 27. Two tankers already en route were ordered to return.
As a result, oil storage tanks in western Venezuela are reaching capacity, and PDVSA is now scrambling to find floating storage as unsold barrels pile up.
Venezuela’s crude exports in April dropped by nearly 20%, falling to 700,000 barrels per day—the lowest level in nine months. The country had been gradually rebuilding export volumes under eased U.S. sanctions, but the latest crackdown has reversed those gains. The U.S. has imposed a 25% secondary tariff on countries purchasing Venezuelan oil, further complicating trade.
Tensions are rising beyond oil. Armed Venezuelan civilians reportedly clashed with Guyanese troops along the Cuyuni River this week in the disputed, oil-rich Essequibo region. Guyana plans to hold elections in the territory on May 25, despite a binding International Court of Justice order against unilateral moves.
Chevron, along with European firms Eni and Repsol, is now lobbying the U.S. government to allow their operations in Venezuela to continue beyond May.
For now, PDVSA is tightening its grip on oil exports. As politics increasingly dictate oil flows, commercial logic may take a back seat.
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