Venezuela’s state-owned PDVSA has begun exporting a heavy crude oil grade that had been shipped by Chevron since 2022, maritime data and documents showed, following the cancellation of cargoes to the U.S. producer amid payment uncertainty.

The U.S. Treasury Department in March revoked a key license that had allowed Chevron to expand operations in four joint ventures in sanctioned Venezuela and export its crude to the U.S. after President Donald Trump criticized the South American country’s record on migration and democracy.

Though the period granted by Washington to wind down transactions has not ended, PDVSA last month canceled the cargoes it had scheduled for Chevron, citing the U.S. company’s inability to fully pay for them, and ordered the return of a couple tankers that had set sail.

PDVSA has taken some steps to reorganize oil output and crude upgrading since then, increasing supplies to domestic refineries. But the cargo cancellation has led to an accumulation of oil inventories in recent weeks, topping up the state-owned company’s available storage at its oilfields in western Venezuela, and creating a need for floating storage, according to company documents.

Venezuela’s oil exports fell about 10% from the previous month to some 780,000 barrels per day (bpd) in April, mainly due to the standoff with Chevron.

A 920,000-barrel cargo of Venezuela’s heavy Boscan crude, produced by the PDVSA-Chevron joint venture Petroboscan, set sail earlier this month for Malaysia, a trans-shipping hub for Venezuelan crude bound for China, one of the maritime documents showed.

The Suezmax vessel departed from Venezuela’s Amuay ship-to-ship area and is set to arrive in Malaysia around June 20, according to LSEG data and monitoring service TankerTrackers.com.

Before the cargo cancellations, Venezuela’s Boscan crude was exclusively going to U.S. refineries and being exported by Chevron.

PDVSA and Chevron did not immediately reply to requests for comment. Venezuelan President Nicolas Maduro’s socialist government has rejected the U.S. sanctions, saying they amount to an “economic war.”

In 2020, when Washington restricted licenses for foreign oil companies to operate in Venezuela, PDVSA accumulated billions of dollars in pending proceeds and dividends to its joint venture partners, as it controlled all exports from them.

Source: Reuters