The Caribbean nation’s energy sector has sustained production and export levels in recent months. (PDVSA)
Caracas, July 21, 2025 (venezuelanalysis.com) – The Venezuelan oil sector has maintained production and export levels in the face of renewed US sanctions in recent months, showed the latest report from the Organization of Petroleum Exporting Countries (OPEC).
The monthly publication placed the Caribbean nation’s crude output at 910,000 barrels per month (bpd) in June, as measured by secondary sources. The figure represents a 2,000 bpd increase compared to May and reversed a three-month trend of minor output contraction.
For its part, state oil company PDVSA reported production levels of 1.069 million bpd in June, up from 1.066 million bpd the prior month. The direct and secondary data have had minor discrepancies over time due to disagreements on the inclusion of natural gas liquids and condensates.
Since 2017, the Venezuelan oil industry has suffered under the weight of US economic coercive measures. The US Treasury Department has levied financial sanctions, an export embargo, secondary sanctions and a bevy of other measures aimed at strangling the South American country’s most important revenue source.
The Trump administration ramped up pressure in recent months by withdrawing licenses that allowed Chevron and a handful of other foreign corporations to extract and sell crude from joint ventures in Venezuela’s oil sector.
However, in contrast to forecasts of an immediate drop in exports, Venezuela’s oil sector has maintained production and sales levels. Customers with US sanctions waivers saw their wind-down period run out in late May, and PDVSA reassigned cargoes to Chinese customers in June.
According to Reuters, Venezuela exported an average 844,000 bpd of crude and refined products last month, up from 779,000 bpd in May, and 233,000 metric tons of byproducts and petrochemicals. Around 90 percent of shipments were sent to Chinese refineries, either directly or via transshipments.
Venezuelan crude sales also benefited from a 10 percent hike in the price of its flagship Merey blend last month.
Nevertheless, spot oil exports are more vulnerable to market volatility than long-term contracts with joint venture partners. Sales to China likewise force PDVSA to levy significant discounts and resort to intermediaries in order to bypass US sanctions. Washington has threatened to impose “secondary tariffs” on countries that receive Venezuelan crude, but the measure has not been enacted.
Venezuela has actively courted Chinese investments to boost its oil sector recovery, with Vice President and Oil Minister Delcy Rodríguez visiting China in April. Rodríguez met with China National Petroleum Corporation (CNPC) in an effort to have the company increase its dealings with Venezuela. CNPC halted direct purchases of Venezuelan oil in late 2019 due to the threat of secondary sanctions.
While the state-owned giant has not disclosed plans for new contracts or investments, Chinese firms China Concord Petroleum and Anhui Guangda Mining are reportedly among a list of new partners under so-called “productive participation contracts” (CPP). The US Treasury has blacklisted China Concord over dealings in Iran.
Defined under the 2020 Anti-Blockade Law, CPP agreements are more flexible than joint ventures, allowing private entities further control over oil operations and sales than under Venezuela’s energy legislation. A leaked list showcased 13 potential PDVSA partners with an increased production ceiling of 945,000 bpd and investment requirements of US $32 billion.
The purported production plans would focus on Lake Maracaibo and the Orinoco Oil Belt. Agreements under Venezuela’s Anti-Blockade Law have sparked debate and criticism within Chavista ranks over their reported lack of transparency and concerns of reduced sovereignty in the energy sector.
Edited by José Luis Granados Ceja in Mexico City, Mexico.
