Asian Buyers Demand Discounts on Venezuelan Crude Amid Sanction Flood

Venezuelan oil faces deep discounts in Asia due to abundant sanctioned supplies from Russia and Iran and increased U.S. military presence. PDVSA struggles to maintain revenue amidst rising exports but dwindling negotiation power. U.S. pressures persist as Venezuela bets on China to sustain its oil-driven economy.

Asian buyers are insisting on significant discounts for Venezuelan crude oil as the market is saturated with sanctioned oil from Russia and Iran. The heightened risk of shipping amid U.S. military buildup in the Caribbean further compounds the challenges, sources within the trading sector revealed.

Despite pressure from the U.S. on President Nicolas Maduro, Venezuela has managed to boost oil exports compared to previous volumes. However, Venezuelan oil prices suffer due to lower global crude prices, lack of quality, and sanctions.

While PDVSA endeavors to avoid financial collapse, trading participants indicate they have been compelled to reduce prices to maintain buyer interest, especially in China, which remains a pivotal destination for Venezuelan exports. Meanwhile, shipping expenses are rising due to newly implemented 'war clauses' in contracts.

(With inputs from agencies.)