Venezuelan oil exports to China grow

Oct 29, 2007 01:00 AM

Venezuelan oil exports to China are on the rise at the same time sales to the United States are on the decline, the US Department of Energy reported.
Venezuela's state-run energy company PdVSA announced South America's largest oil exporter shipped an average of 197,000 bpd of crude oil and by-products to China so far in 2007. While that amount pales in comparison to the nearly 1.4 mm bpd of Venezuelan oil that was exported to the United States in July, China's exports have risen nearly three-fold since last year.

Erik Kreil, an international oil market analyst at the US Energy Information Administration, noted that Venezuela's exports to China were 27,500 bpd day in the first half of 2005, the first full year Beijing began pursuing Venezuelan petroleum.
Venezuela supplies about 12% of the oil imported by the United States, making it Venezuela's largest customer. It is the No. 4 US supplier.

In July, Luis Vierma, exploration and production vice president at PdVSA, said Venezuelan oil faces a "significant operational emergency" if it does not increase the number of rigs operating in the country and that the state firm fell short of its 2007 goal of getting 191 rigs online in 2007 and producing some 3.3 mm bpd."
PdVSA's independence could take even longer considering Venezuela's oil output is believed to have slipped by more than 250,000 bpd from a year ago, according to the Paris-based International Energy Agency.

Production has reportedly decreased from 2.6 mm bpd to 2.37 mm bpd.
Hoping to counter the production shortfall, PdVSA announced recently it was investing $ 3.5 bn in new oil rigs, a much-needed injection of cash for improvements.

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