Billions of barrels of Venezuela’s oil claimed by major state-owned Chinese and Russian companies under current deals are now in doubt following the U.S. capture of Nicolas Maduro, according to investment bank Morgan Stanley.
Oil giant and top Asian refiner China Petroleum & Chemical Corporation, or Sinopec, is entitled to as many as 2.8 billion of barrels under current agreements with Venezuela’s state oil firm PDVSA, per a note by Morgan Stanley Research cited by Bloomberg. That’s the single biggest clam by a company that has operated in Venezuela.
Roszarubezhneft of Russia is next, with 2.3 billion barrels worth of claims on Venezuelan oil, according to Morgan Stanley, which used data from Wood Mackenzie to estimate the claims.
CNPC of China has more than 1 billion barrels of Venezuelan oil reserves, followed by U.S. supermajor Chevron, which is entitled to 900 million barrels of Venezuela’s oil.
Other companies, including small Venezuelan firms, Italy’s Eni, and Spain’s Repsol, also have hundreds of millions of barrels of Venezuela’s oil reserves each, the Morgan Stanley estimate showed.
“The crucial question is what will happen with Venezuela’s production from here. This remains hard to forecast,” Morgan Stanley’s analysts wrote in the note.
“Over the medium term, however, risks to production are clearly to the upside, at least from a resource and technical perspective.”
The capture of Nicolas Maduro was followed by claims by U.S. President Donald Trump and Secretary of State Marco Rubio that American oil companies would be very interested in rebuilding Venezuela’s oil industry.
Chevron is currently the only U.S. – and Western – company authorized to operate in Venezuela and export the crude to the United States.
“We’re going to have our very large U.S. oil companies, the biggest anywhere in the world, go in, spend billions of dollars, fix the badly broken infrastructure, oil infrastructure, and start making money for the country,” President Trump said on Saturday, shortly after the Venezuelan leader was captured and flown to the U.S. to face drug cartel-related charges.
By Tsvetana Paraskova for Oilprice.com
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