US allows oil companies to operate in Venezuela until December

Washington DC, Apr 21 (efe-epa).- The United States government on Tuesday extended the licenses of five oil companies to continue operating in Venezuela until Dec. 1 despite sanctions against Venezuela’s state-owned company, Petroleos (PDVSA).

The decision affects Chevron Corp, the last major US oil company still operating in Venezuela, as well as four US oilfield service providers: Halliburton, Schlumberger, Baker Hughes and Weatherford International, the US Treasury Department said in a statement.

This is the fifth time that the US government has issued such an authorization to these companies. The last time it did so was in January, when it extended their licenses for three months, until Apr. 22.

More than a year ago, US President Donald Trump’s government imposed sanctions on Venezuela’s state-owned oil company, PDVSA, to ramp up pressure on President Nicolas Maduro to cede power to opposition leader Juan Guaido, recognized by the US and more than 50 countries as the legitimate leader of the country.

As a result of the sanctions, the assets of PDVSA – which is an important source of revenue for Venezuela – subject to US jurisdictions are blocked.

However, the US has issued special licenses to some US energy companies to continue operating in the South American country on a temporary basis.

Chevron Corp is the only major US oil company remaining in Venezuela, where it has 8,000 employees.

ExxonMobil and ConocoPhillips exited Venezuela – the country with the largest oil reserves in the world – years ago, following the nationalization of the sector by the late Venezuelan president, Hugo Chavez.

The extension of licenses until the end of the year coincides with the fall in oil prices, which collapsed again on Tuesday due to low demand amid the coronavirus pandemic and the possibility that crude oil storage facilities will run out of space, an unprecedented situation.

The price per barrel of West Texas Intermediate, whose crude for May expired on Tuesday, closed at $9 after plunging into negative territory for the first time in history to $-37.63 a barrel the previous day.

West Texas Intermediate and Brent crude for June delivery, both considered the key benchmark price for crude oil, lost 43 percent and 25 percent respectively. This was Brent’s lowest finish since 2001.

The paralysis of activity due to the COVID-19 pandemic is undermining demand for a raw material that is suddenly no longer so essential. EFE-EPA


Related Articles

Back to top button