WASHINGTON – The return of major American companies to oil production in Venezuela will be difficult due to the specific characteristics of the country and the situation on global markets, and restoring production to late 20th-century levels could take decades, according to American energy expert Tom Kloza.
„We would have to go back fifty years to find a Venezuela that gave multinational oil companies free rein in the country. It will not be easy to convince companies like ExxonMobil or Conoco to return to a country that has cost them billions of dollars.“ said Kloza, who is currently the chief oil market analyst at the American consulting firm Turner Mason & Co. and also runs his own consulting firm, Kloza Advisors LLC.
According to the expert, Venezuelan oil production peaked at 3.5 million barrels per day in 1997, while current production is estimated at around 900,000 barrels per day, of which approximately 500,000–550,000 barrels per day are exported.
„In 1997, American companies occasionally imported approximately 1.4 million barrels of Venezuelan oil per day. It will take decades to restore production to the levels of those years.“ added Kloza.
Oil from the Middle East or the Permian Basin in the USA is relatively easy to extract. „However, Venezuelan oil is very challenging due to its geography, high sulphur content, low density and high viscosity, which only highly sophisticated refineries can handle. It is therefore not surprising that estimates of the break-even point for Venezuela vary significantly.“ noted the expert.
According to him, Venezuelan oil „It competes with Canadian heavy crude oil, which cost approximately $44 per barrel in Alberta, which is $13 less than WTI crude oil.“
Kloza also said that if Venezuela were to descend into chaos and its exports were to stop, the world would lose a maximum of one million barrels per day. He explained that in 2025, oil supply exceeded demand by about 1.5 million barrels per day, and this year the difference could rise to 2.8 million barrels per day.
„Even the complete loss of Venezuelan oil cannot tighten the relaxed global markets.“ He added.
US President Donald Trump has previously stated that Washington will take temporary control of Venezuela and expressed his conviction that the US will receive compensation from Caracas for American oil companies, which are to allocate funds for the restoration of Venezuela's oil infrastructure.
According to the expert, returning production to two million barrels per day could be relatively easy with a supportive administration, but it would not happen until later in the decade. Rystad Energy estimates that restoring production to early 21st century levels would require twice the $55 billion that US companies invested in exploration and production last year.
gnews.cz - GH
English 
Czech 
Spanish 
French 
Italian 
Russian 
Chinese 
German