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Venezuela resumes oil shipments to China despite US sanctions

Venezuela China oil_IFM_Image
China is the biggest buyer of Venezuelan crude

Venezuela has resumed sending crude oil shipments to China despite US sanctions, according to media reports. China is also the biggest buyer of Venezuelan crude. Previously, Venezuela sold oil to China via ship-to-ship transfers at sea, however, now Venezuela will deliver crude directly to Chinese shores. It is not clear how much oil is being imported from Venezuela by China.

In October, China’s crude oil imports registered a 6.5 percent year-on-year decline since April to 10.06 million barrels per day (bpd), as refiners slowed down on their purchases amid a drop in throughput and less import quotas.

Crude oil imports in the month of July by China was estimated to have dropped by around 3 percent when compared to the month of June, according to data provided by energy analytics services provider OilX. The crude oil import in July by China was still higher if we compare it to the same period in 2019.

Chinese state-owned oil giants, namely China National Petroleum Corporation (CNPC) and China National Offshore Oil Corporation (CNOOC) are interested in ExxonMobil’s operating stake in the West Qurna 1 oil fields in Iraq. West Qurna 1 is one of the largest oil fields in Iraq.

Exxon owns a 32.7 percent stake in the Exxon oil field and it could be worth $500 million. However, it is currently uncertain whether a deal is in place or not. Also, geopolitical factors could lead to a no-deal situation in this regard. Previously, Exxon sold 25 percent of its stake in the oil field to PetroChina and 10 percent to Pertamina.

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