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Venezuela Oil Price Gaps Higher Venezuela's Ministry of Petroleum and Mining reports that the average price of Venezuelan crude sold by Petroleos de Venezuela S.A. (PDVSA) gapped higher during the week ending May 11
CARACAS -- The price Venezuela receives for its mix of medium and heavy oil rose aggressively along with world prices during the week ending May 11.
According to figures released by the Venezuela Ministry of Petroleum and Mining, the average price of Venezuelan crude sold by Petroleos de Venezuela S.A. (PDVSA) during the week ending May 11 rose to $66.57, up $2.44 from the previous week's $64.13.
WTI in New York averaged $70.40 -- up $2.34 -- for the week, while Brent crude traded in London averaged $76.11 -- up $2.22 from the previous week.
According to Venezuelan government figures, the average price in 2018 for Venezuela's mix of heavy and medium crude for 2018 is $60.52.
Venezuela's average oil price for 2017 was $46.66, up from 2016's $35.15. It is higher than 2015's $44.65 but lower than 2014's $88.42, 2013's $98.08, 2012's $103.42 and 2011's $101.06, 2010's $72.43. The 2009 average was $57.01.
In 2017, WTI averaged $50.88 -- up from 2016's $43.32 -- while Brent averaged $54.73 -- up from 2016's $44.98.
Historically, Venezuela's basket set its highest weekly average ever on July 18, 2008, when it hit $126.46 before economies around the world began crashing under the weight of expensive oil. The recent low was set January 22, 2016, when Venezuela's basket averaged just $21.63.
The United States is the largest importer of Venezuela’s oil exports.
According to the US Department of Energy, Venezuela is the third-largest supplier of imported crude oil and petroleum products to the United States, though U.S. imports from Venezuela have been on an overall decline in recent years.
In 2016, the United States imported an average of 797,000 barrels per day of crude oil and petroleum products from Venezuela, a decline of 49% from a decade ago. That makes Venezuela the third largest supplier of crude to the U.S., after Canada's 3.556 million bpd and Saudi Arabia's 1.02 million bpd. Mexico was fourth with 623,000 bpd, Iraq fifth with 414,000 bpd, Colombia sixth with 315,000 bpd, and Ecuador the seventh largest supplier with 250,000 bpd. Kuwait, Nigeria and Brazil round out the top 10 U.S. suppliers.
Venezuela sends a large share of its oil exports to the United States because of the proximity and the operation of sophisticated U.S. Gulf Coast refineries specifically designed to handle heavy Venezuelan crude.
While U.S. imports of primarily crude oil from Venezuela have been on the decline, U.S. exports of petroleum products to Venezuela have increased largely because of Venezuela’s tight finances that leave it unable to invest and maintain its own domestic refineries.
Oil is the main export of Venezuela and provides most of the country's foreign currency.
As of 2015, Venezuela had nearly 298 billion barrels of proved oil reserves -- the largest in the world. The next largest proved oil reserves are in Saudi Arabia with 268 billion barrels and Canada with 173 billion barrels.
Venezuela reported to OPEC -- where Venezuela is a founding member -- that its production had fallen to 1.509 million barrels per day in March 2018. OPEC calculated Venezuela's March oil production even lower at 1.488 million bpd.
Under 2016's OPEC agreement, Venezuela agreed to cut its production by 95,000 bpd to 1.972 million bpd.
In 1998, the year prior to Hugo Chavez becoming president, Venezuela was producing 3.5 million bpd and had plans to increase that production go 6 to 8 million bpd by 2008. Instead, expropriations, disastrous communist economic policy, hyperinflation, corruption, and political purges and loyalist hiring have brought Venezuela's once mighty oil production to just half of what it was 20 years ago.