Thursday, January 24, 2013

EIA: Political risks focus attention on supply of Venezuelan oil to the United States

Uncertainty about the health of Hugo Chávez, Venezuela's president, has raised interest in understanding Venezuela's contribution to U.S. oil supply. Venezuela, a member of the Organization of the Petroleum Exporting Countries (OPEC), ranks among the 15 largest global oil producers and is the United States's fourth-largest source of imported oil, behind Canada, Saudi Arabia, and Mexico. Meanwhile, the United States, the world's largest oil consumer and oil importer, is the leading destination for Venezuelan oil exports.

Venezuela and the United States (the U.S. Gulf Coast in particular) are naturally attractive oil-trading partners because of their geographic proximity and a lack of transit chokepoints between them. Furthermore, the robust trade in crude oil from Venezuela to the United States is due to the compatibility between the configuration of some U.S. refineries and the quality characteristics of Venezuelan crude, which is predominately sour (high sulfur content) and medium or heavy (lower degrees of API gravity, meaning it has a higher density). The U.S. Gulf Coast has a concentration of sophisticated refineries (including some wholly or partially owned by Citgo Petroleum Corp.....Read the entire EIA article

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