(Reuters, 30.Mar.2020) — Venezuela’s crude production ended last week at around 670,000 barrels per day (bpd), according to documents seen by Reuters and two people with access to output data, the lowest level in five months amid U.S. sanctions and falling global demand.
The Orinoco oil belt, Venezuela’s largest producing region, produced an average of 364,930 bpd so far in March, according to an internal report by state oil company PDVSA seen by Reuters and dated March 27, though on Friday projects there produced some 420,340 barrels of extra-heavy crude.
The region had produced nearly 500,000 bpd in January, according to private estimates.
Output in the western Zulia region was at 150,000 barrels on Friday, while Venezuela’s northeast oilfields produced 100,000 barrels after an explosion at a key pumping station earlier this month left some 40,000 bpd offline, according to oil workers’ union leader Ivan Freites and a person with access to the data who spoke on condition of anonymity.
Neither PDVSA nor Venezuela’s oil ministry responded to requests for comment.
The March figures mark the end of a period of relative stabilization from November through February, when output remained between 865,000 bpd and 912,000 bpd, according to the country’s reports to OPEC.
Venezuela’s is among the group of OPEC members struggling the most to cover their public budgets amid very low oil prices caused by a combination of falling demand due to the coronavirus outbreak and a price war between the world’s biggest producing nations after a failed attempt to curb output.
President Nicolas Maduro, who confirmed Venezuela is selling its oil below production costs, earlier this month called on an alliance between OPEC and non-OPEC nations to stabilize the market through a new production agreement.
Besides falling output, PDVSA is again struggling with mounting inventories of unsold oil as exports dwindle and its portfolio of customers shrinks.
The drop in March came after Washington, seeking to oust Maduro, sanctioned two units of Russian oil giant Rosneft which had been key intermediaries for PDVSA crude.
Rosneft on Saturday announced its withdrawal from Venezuelan projects through a coordinated sale of assets to an undisclosed firm controlled by the Russian government.
It is yet unknown how that move will affect Rosneft’s projects with PDVSA. The main joint venture, Petromonagas in the Orinoco belt, produced 79,000 barrels on Friday but was running out of storage space, according to a PDVSA document.
By Deisy Buitrago and Mircely Guanipa; Additional reporting by Marianna Parraga; Additional reporting and writing by Luc Cohen; Editing by Chris Reese