Venezuelan oil in the sights of the United States

In the midst of the escalation of oil due to the war in Ukraine, the visit of an American delegation to Venezuela puts on the table a possible return of the llaneros barrels to the market, after Joe Biden’s announcement to embargo the import of crude oil from Russia.

Figures from the US Energy Information Administration (EIA) as of November 2021 show that the North American nation imported 178,550 barrels per day from Petroleum From Russia.

José Raunelli, Investment Manager of Auryn Holdings, announced that “although the meeting is a sign that alternatives to Russian energy are being sought, the negotiation will be very long not only because of the sanctions that Washington will have to lift on Caracas, but also because of the financial commitments that Venezuela has with Russia and China”, such as the investment of US$ 9,000 million made by the Russian state oil company Rosneft.

Venezuelan fuel has not been sold in the US market since 2019. The question is whether the oil it provides will meet market demand.

César Romero, head of research at Renta 4 SAB, anticipated that Venezuela could contribute a maximum of 1.5 million barrels per day to the US market, and just one million barrels per year to the global market, 1% compared to the 10 million that Russia contributes annually.

Effects in Peru of escalation

The volatility of oil, due to the war, arrived this week in Peru. Osinergmin reported last Monday a list of reference prices that, in the opinion of the expert in energy policies, Gustavo Navarro, had a foreseeable upward trend for all crude derivatives. For the former director general of Hydrocarbons, the situation is explained by the economic siege that Russia faces, one of the main global suppliers, and whose aftershocks should be felt stronger next week in the taps, given that the barrel exceeds the US these days. $120.

“It is a strictly circumstantial rise, a psychological issue given the fear that the market will run out of fuel. They seek to protect themselves with additional purchases, which creates a feeling of scarcity”, he refers.

In this sense, Navarro estimates that the price of oil, which does not always go hand in hand with that of gasoline, and whose highest consumption occurs in the northern hemisphere, should fall faster than its rebound once the war is over. However, he emphasizes that, unlike those countries, Peru has natural gas not subject to international prices as an alternative to counteract these scenarios, so any solution must aim at its mass use.

“In a war context, diesel is the fuel that powers tanks, ships and other combat vehicles. My estimate is that the fall will be stronger than the rise, ”he affirms.

Not everyone loses in Peru

The former president of Perupetro Aurelio Ochoa recalls that, in our country, all the oil that is extracted from the jungle goes to the internal market, but with an international price. In other words, exploiting it at the hands of a private company can cost around US$25 per barrel, but it is sold to refineries at five times its price. This, without production costs rising beyond a few dollars.

“If that margin were for Petroperú, it could be capitalized and increase internal production. Today we produce about 40,000 barrels of 250,000 per day that are consumed, the rest we import from countries like Colombia, where Ecopetrol is committed, ”he says.