Venezuela has stayed behind in delivering crude to customers from its oil export terminals, as delays and production declines could damage the state-run PDVSA’s supply contracts if they are not cleared as soon as possible.
Namely, as Reuters reported, tankers waiting to load more than 24 million barrels of crude, are sitting off the country’s main oil port. The delay is so severe, that PDVSA told some customers it may declare force majeure. This means that it will temporarily halt contracts, if they do not accept new delivery terms.
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The delays have increased since May, when due to asset seizures PDVSA stopped using Caribbean facilities for export cargoes. But this situation began months ago as production declines accelerated.
Last year, PDVSA lost two supply contracts, one with US.PBF Energy and one with Brazil Braskem, because of unstable supply and US sanctions. Since then, delays have only increased.
In order to avoid breach contracts, PDVSA is trying for its customers to agree to load cargoes in ship-to-shipoperations off the nation’s western coast to ease congestion at its Jose port. If that happens, it is possible that the delays there and at its Paraguana Refining Center will stop.
However, a senior Chinese state-oil official said that he is not sure if PDVSA can deliver on time.