Venezuela’s Oil Exports Drop 9% as Freight Costs Bite
Venezuela's oil exports declined nearly 9% in September to about 1.08 million barrels per day, as rising tanker freight costs prompted trading houses to push state oil firm PDVSA for larger discounts and contributed to shipment delays. Despite the overall drop, U.S. purchases of Venezuelan crude increased while shipments to India and Europe fell.
Why It Matters
The squeeze from higher freight rates is eroding trading margins and disrupting flows from a major oil exporter, complicating efforts to boost Venezuelan production even as foreign companies pledge investments. Persistent port congestion and the need for substantial drilling capacity growth could constrain planned output increases.
Key Facts
- September exports: 1.08 million barrels per day
- Percentage drop in September: Nearly 9%
- Venezuela crude production (August, OPEC-reported): About 1.2 million bpd
- U.S. shipments (September): 629,000 bpd (up from 553,000 bpd in August)
- India shipments (September): 253,000 bpd (down from 297,000 bpd)
Venezuela's oil exports fell to roughly 1.08 million barrels per day in September, a near 9% decline from the prior month, as surging tanker freight costs prompted traders to seek deeper discounts and slowed cargo movements. Global trading houses including Vitol and Trafigura pressed state oil company PDVSA for improved commercial terms after transport expenses began to significantly compress trading margins.
The pattern of flows shifted regionally: U.S. imports of Venezuelan crude rose to about 629,000 bpd in September from 553,000 bpd in August, while shipments to India dropped to 253,000 bpd from 297,000 bpd. European purchases saw the largest fall, sliding to 86,000 bpd from 260,000 bpd. Chevron's shipments were largely steady at about 283,000 bpd, and trading firms moved 637,000 bpd versus 597,000 bpd the month before.
Venezuela's reported production to OPEC in August was about 1.2 million bpd, and inventories at the Jose export terminal decreased only modestly in September from elevated levels earlier in the year. Analysts and industry groups say the export and shipping bottlenecks, including tanker reroutings that added to delays accumulated over the summer, are constraining the pace at which oil can be moved despite interest from international companies.
Foreign firms were active in Caracas the same week the export figures emerged: more than 250 companies attended meetings on new Venezuelan oil development, and Chevron has pledged over $7 billion across five years with a target to raise its Venezuelan output to around 600,000 bpd. Research firm Rystad Energy projects Venezuelan production could climb to 1.6 million bpd by 2028 and 1.8 million bpd by 2030, but it also notes the country will need a large increase in drilling activity — from just two active rigs in August to roughly 50 by 2028 and nearly 80 by 2030 — as well as improvements in logistics to reach those levels.