PetroChina to Resume Oil Trade with Venezuela post Four Year Halt

As per four people familiar with the matter, China's PetroChina is proposing to buy up to 8 million barrels of Venezuelan crude per month from state-run oil company PDVSA, hoping to resume a trade suspended four years ago by US sanctions. The US Treasury Department temporarily lifted the sanctions in October, allowing Venezuela to resume exporting crude, petrol and fuel to its most important customers. Washington has stated that the six-month reprieve is contingent on Venezuela's government agreeing to hold a free and open presidential election next year.

Since the sanctions were lifted, some companies that had purchased Venezuelan oil prior to the sanctions have attempted to resurrect those transactions.

According to two sources, PetroChina, China's second-largest oil refiner, has offered yuan payment for approximately 265,000 barrels per day (bpd) of Venezuelan crude through its joint ventures with PDVSA, allowing them to rebuild cashflow and capital for production investment.

"They are working on it," a source close to PetroChina said. Prior to the sanctions, the company was taking up to six 2 million-barrel cargoes of Venezuelan oil per month.

Following the US actions, China's government demanded that all sanctions against Venezuela be lifted. In September, President Nicolas Maduro travelled to China with a large delegation to re-launch bilateral trade, with a focus on restoring direct energy trade.

Washington imposed sanctions on Venezuela's oil sector in 2019 and later prohibited non-US customers from purchasing the country's oil, disrupting trade between PDVSA and Chinese state firms such as China National Petroleum Corp and PetroChina.