Vitol, Trafigura Pitch Venezuelan Crude To India, China
ECONOMY & POLICY

Vitol, Trafigura Pitch Venezuelan Crude To India, China

Global commodities traders Vitol and Trafigura have begun discussions with refiners in India and China to sell Venezuelan crude oil cargoes for delivery in March, according to multiple trade sources.

The talks follow confirmation by the traders last week that they had reached agreements with the US government to help market stranded Venezuelan oil. The move comes days after the interim government in Caracas agreed to export up to 50 million barrels of crude to the US, paving the way for a partial resumption of exports that had been curtailed following the ouster of President Nicolas Maduro.

The traders are moving quickly to secure shipping and place cargoes. Trafigura’s chief executive has said the company will load its first Venezuelan cargo for the US this week. Vitol, meanwhile, is understood to be approaching Indian state-owned refiners with offers for Venezuelan crude.

According to sources, Vitol has offered at least one cargo at a discount of about $8 to $8.50 a barrel to ICE Brent on a delivered basis. State-run refiners Indian Oil Corporation and Hindustan Petroleum Corporation have indicated they would consider buying Venezuelan oil, though neither company commented on the latest discussions.

Reliance Industries has also said it would consider resuming purchases of Venezuelan crude if sales to non-US buyers are permitted under US regulations.

In China, Vitol and Trafigura have approached PetroChina, which was previously a major buyer of Venezuela’s heavy sour Merey crude and fuel oil before US sanctions were imposed. Sources said the traders are likely to prioritise large state-owned oil companies rather than independent refiners, commonly known as teapots, which typically purchase heavily discounted sanctioned crude. PetroChina did not respond to requests for comment.

Trafigura said it is providing logistical and marketing services to facilitate Venezuelan oil sales but declined to comment on specific negotiations. Vitol also declined to comment. One source said cargoes are being offered for delivery in the second half of March.

Separately, shipping data showed that Vitol on Sunday loaded its first cargo of naphtha from the US to Venezuela aboard the Panamax vessel Hellespont Protector, which is expected to arrive at Venezuela’s Port of Jose on January 28. Naphtha is used to dilute Venezuela’s heavy crude, making it easier to transport and process.

The imminent return of Venezuelan oil to global markets has helped offset concerns over potential supply disruptions from Iran, limiting gains in international oil prices.

Global commodities traders Vitol and Trafigura have begun discussions with refiners in India and China to sell Venezuelan crude oil cargoes for delivery in March, according to multiple trade sources. The talks follow confirmation by the traders last week that they had reached agreements with the US government to help market stranded Venezuelan oil. The move comes days after the interim government in Caracas agreed to export up to 50 million barrels of crude to the US, paving the way for a partial resumption of exports that had been curtailed following the ouster of President Nicolas Maduro. The traders are moving quickly to secure shipping and place cargoes. Trafigura’s chief executive has said the company will load its first Venezuelan cargo for the US this week. Vitol, meanwhile, is understood to be approaching Indian state-owned refiners with offers for Venezuelan crude. According to sources, Vitol has offered at least one cargo at a discount of about $8 to $8.50 a barrel to ICE Brent on a delivered basis. State-run refiners Indian Oil Corporation and Hindustan Petroleum Corporation have indicated they would consider buying Venezuelan oil, though neither company commented on the latest discussions. Reliance Industries has also said it would consider resuming purchases of Venezuelan crude if sales to non-US buyers are permitted under US regulations. In China, Vitol and Trafigura have approached PetroChina, which was previously a major buyer of Venezuela’s heavy sour Merey crude and fuel oil before US sanctions were imposed. Sources said the traders are likely to prioritise large state-owned oil companies rather than independent refiners, commonly known as teapots, which typically purchase heavily discounted sanctioned crude. PetroChina did not respond to requests for comment. Trafigura said it is providing logistical and marketing services to facilitate Venezuelan oil sales but declined to comment on specific negotiations. Vitol also declined to comment. One source said cargoes are being offered for delivery in the second half of March. Separately, shipping data showed that Vitol on Sunday loaded its first cargo of naphtha from the US to Venezuela aboard the Panamax vessel Hellespont Protector, which is expected to arrive at Venezuela’s Port of Jose on January 28. Naphtha is used to dilute Venezuela’s heavy crude, making it easier to transport and process. The imminent return of Venezuelan oil to global markets has helped offset concerns over potential supply disruptions from Iran, limiting gains in international oil prices.

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