Oil tankers are still making their way to Venezuela despite Washington’s naval blockade, a sign that Caracas is leaning harder on floating storage and debt-linked crude shipments even as its export system begins to clog.
At least two tankers arrived in Venezuelan waters in recent days, and others are approaching the coast, according to Reuters calculations and data from TankerTrackers.com. The arrivals come as U.S. enforcement has cut Venezuela’s oil exports roughly in half from November levels, seized two cargoes, and pushed many shipowners to turn back or reroute mid-voyage.
The tankers pressing on are not random. Several are part of long-standing oil-for-debt arrangements that send Venezuelan crude to China as payment on billions of dollars in outstanding loans, leaving little immediate revenue for Venezuela. Venezuela moves oil not to earn cash, but to keep creditors at bay.
The problem is logistics. PDVSA is loading and unloading at a slower pace after a cyberattack disrupted its administrative systems. On top of that, U.S. patrols have narrowed the exit routes for sanctioned vessels. The combination of factors has led to a growing armada of tankers sitting offshore. Floating storage has risen to roughly 16 million barrels, up sharply from just a couple weeks ago. Nearly two dozen vessels are now visible near the Jose terminal alone.
Venezuela has been down this road before. In 2020, earlier rounds of U.S. pressure forced Venezuela into obscure intermediaries, deeper discounts, and ultimately production shut-ins. The same pattern is emerging again. PDVSA has already begun shutting wells in the Orinoco Belt as storage fills and diluent imports are squeezed.
China’s role is also different than it once was. While Chinese-linked tankers are still involved, Beijing has spent years distancing itself financially from Venezuela after unpaid bills and sour returns. Oil continues to flow east, but patience is thin, and prices are steeply discounted.
The only cargoes leaving cleanly are Chevron’s, shipped to the U.S. Gulf Coast under a waiver that Washington has preserved even as it tightens enforcement elsewhere. That carve-out matters for complex refiners, but it does little to solve Venezuela’s broader problem.
By Julianne Geiger for Oilprice.com
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