U.S. Restrictions Impact Venezuelan Oil Trade

The U.S. government's deadline for transactions involving Venezuelan oil has passed, leading to the completion of remaining cargo loadings and the departure of vessels under U.S. licenses. This marks the end of a period in which companies were allowed to engage with Venezuelan oil despite sanctions.

The U.S. Treasury and State departments had given corporations like Chevron and Repsol until May 27 to conclude their business. Their authorizations, originally granted in previous years, were rescinded as part of a harder stance from the Trump administration towards Venezuela. Significant deals, including a large swap involving PDVSA, Maurel & Prom, and Vitol, were finalized just before the deadline.

As the authorized deals ceased, a noticeable decrease in Venezuelan crude sales to U.S.-approved companies occurred, partly offset by shipments to intermediaries in Asia. Analysts anticipate a potential 15-30% decline in Venezuela's oil output by the next year without these licenses, despite improving production levels. Venezuela's President Nicolas Maduro condemns the sanctions as part of an ongoing economic conflict.

(With inputs from agencies.)