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EIA: Limited scope for increased Venezuelan oil production

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The US Energy Information Administration has released an assessment of how crude oil production may increase in Venezuela.

The conclusion of this is that any gains are likely be limited to 200,000 barrels per day (b/d) by the end of next year.

The US recently lifted most of its sanctions on the country for six months following political progress on holding elections next year. This now opens the way for more of its heavy, sour crude oil to be exported, with this oil type having significantly risen in price recently due to a shortage of supply.

Previously, only Chevron, the producer of the Texaco Multifak grease range, had an exemption to operate in the country and export crude oil, to pay off the debt owed by the state-owned oil company PDVSA.

The EIA predicts that Chevron’s joint ventures will be responsible for most of the growth, although it adds that other companies may increase production:

“Ventures operated by ENI, Repsol, and Maurel & Prom could increase production by an additional 50,000 b/d in the near term, according to IPD Latin America. As a result, we asses that these ventures could raise Venezuela’s total output to about 900,000 b/d by the end of 2024.”

At the turn of the century, Venezuela was producing some 3.2 million barrels per day. Despite having the world’s largest proven oil reserves, it has fallen to 10th place in terms of production in OPEC, at just 735,000 bpd in September this year due to years of sanctions, mismanagement, and underinvestment in the sector.

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