Venezuelan oil production drops for the sixth consecutive month, highlighting the country's dire oil industry as US sanctions hit exports and demand for coronavirus strikes falls.
State-owned company Petroleos de Venezuela SA reported about a 32% reduction in production in June – 200,000 barrels per day compared with the previous month – according to the documents of the company and the Ministry of Oil, which Bloomberg saw. As of June 28, production was 422,400 barrels per day.
Venezuela, where the world's largest oil reserves are located, struggled to rehabilitate its depleted oil industry as the Trump administration tightens sanctions in an attempt to overthrow President Nicolas Maduro. The United States sanctioned at least 50 tankers that are known to carry Venezuelan oil or supply gas to the country, which led to the cessation of oil exports, which are crucial for the bankruptcy of the Maduro regime.
Foreign buyers canceled cargo, storage tanks are filled to capacity and PDSVA was forced to shut down the wells. In May, the only oil rig was drilled in the country, and supplies fell to a level that had not been for 73.
From June 1 to June 15, the largest decline in production occurred in the Orinoco oil belt, where production fell by almost 50% to 148,000 barrels per day, as documents show. Production in the Maracaibo basin fell by about 40% to 83,600 barrels per day. Total oil production hit a 74-year low on June 10 from 374,000 barrels per day.
Petrocaribe restart plan
More recently, Republic Minister of Petroleum Industry Tarek al-Aissami announced that the Petrocaribe program will be restarted.
The Petrocaribe program was launched to diversify the supply of Venezuelan oil, which was then mainly directed in the USA. Formally, she did not stop acting. However, several parties withdrew from the contract during the crisis when Venezuela cut off supplies.
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