U.S. imports of Venezuelan crude hit a nine-year weekly high in September, and Chevron sits at the center of the rebound. The company is investing billions in its Venezuelan joint ventures while its U.S. refineries run at record throughput, giving it exposure on both ends of the barrel.
U.S. imports of Venezuelan crude oil climbed to 782,000 barrels per day in the week ended Sept. 11, the highest weekly total since August 2017, according to the U.S. Energy Information Administration. That figure jumped by 183,000 barrels per day in a single week.
The move is part of a broader trend. Over the past six months, Venezuelan imports have risen by 550,000 barrels per day, or 237%. The three-month average reached 626,000 barrels per day.
Imports remain well below Venezuela's historical peak, when U.S. purchases reached roughly 1.5 million barrels per day in 1997 and routinely topped 1 million barrels per day between 1995 and 2007. Still, the direction has turned sharply upward.
Chevron expands its Venezuelan position
Chevron announced updated agreements on Sept. 2 covering its Venezuelan joint ventures, including additional acreage in the Orinoco Belt. The company plans to invest more than $7 billion over the next five years.
It expects production from its Venezuelan ventures to more than double to approximately 600,000 barrels per day. Chevron says total production costs are below $20 per barrel.
The U.S. Treasury continues to regulate Venezuela-related activity, but the Sept. 11 Federal Register listed Chevron among companies authorized to conduct specified Venezuela-related operations.
President Trump has said he will use Venezuelan oil to help refill the Strategic Petroleum Reserve, adding government demand on top of Chevron's growing upstream position.
Refining capacity adds another angle
Venezuelan crude runs heavier than much of U.S. shale output, so refinery configuration matters. Chevron's U.S. refineries processed a record 1.07 million barrels per day in the second quarter. The plants operated at more than 97% utilization. That combination lets Chevron participate in Venezuela's upstream recovery while its downstream operations process the heavier grade the country typically ships.
Even so, Venezuela remains a geopolitical and regulatory risk, and the 600,000-barrel production target is not guaranteed.
Source: 24/7 Wall St.
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