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Venezuelan Oil: More Going to China, Less to US

AP
Monday, 30 Jun 2008 | 4:18 PM ET

U.S. imports of Venezuelan oil fell 11.7 percent during the first four months of the year compared to the same period in 2007, the U.S. government said Monday.

Hugo Chavez
Howard Yanes
Hugo Chavez

Independent analysts said the fall could be due to stagnating Venezuelan oil production, lower overall U.S. crude imports and Venezuela's attempts to diversify its market by selling more to China and other countries.

The figures released by the U.S. Energy Information Administration showed U.S. imports of crude oil and petroleum products from Venezuela declined to an average of 1.1 million barrels per day in the first four months of 2008 from just under 1.3 million barrels a day in the same period last year.

The new figure is its lowest for any four-month period since a 2002-2003 oil strike paralyzed Venezuela's economy.

State oil company Petroleos de Venezuela SA says it is producing 3.2 million barrels a day, while the Paris-based International Energy Administration puts Venezuela's production at around 2.4.

Leo Drollas, chief economist at the Center for Global Energy Studies in London, said the new figures seem to reflect lower oil output in Venezuela as well as an overall decline in U.S. crude imports due to high prices and decreasing demand for gasoline.

"I'd say it's more the U.S. than Venezuela, but these two factors are working in the same direction," Drollas said.

"There might also be a political angle: trying to increase exports to China because China's perceived as a friendly nation," he said, while the United States is not.

Socialist President Hugo Chavez has repeatedly stressed Venezuela's need to diversify the market for its oil, which traditionally has gone largely to the United States.

Venezuela's crude exports to China jumped 76 percent in the first four months over a year earlier, though they are still a small fraction of sales to the U.S.

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