VLO - Rumored Venezuelan sanctions relief Zelenskyy comments calm oil markets

According to Reuters sources, the US administration has offered to ease sanctions on Venezuela in return for directing a portion of oil exports to the United States (NYSEARCA:USO). The report follows a US import ban on Russian oil, which is likely to impact heavy-oil balances for refiners in the Gulf Coast, like Valero (NYSE:VLO) and Phillips (NYSE:PSX).  Chevron (NYSE:CVX) was the last US producer in Venezuela, and helped the country extract a heavy grade of crude oil, similar to Russian and Canadian grades. However, sanctions have led to a decrease in Venezuelan production of ~2.0mb/d since 2016. The OPEC member has been able to sustain some export volumes, though results have been volatile of late, given infrastructure and supply chain bottlenecks.   The move from the White House comes after OPEC members Saudi and the UAE refused to speak with President Biden, while the Administration scours the world for additional energy supplies.

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Rumored Venezuelan sanctions relief, Zelenskyy comments calm oil markets