By Marianna Parraga and Shariq Khan
HOUSTON/NEW YORK, Feb 3 (Reuters) – U.S. Gulf Coast refiners are struggling to absorb a rapid increase in Venezuelan crude shipments since last month’s landmark $2 billion supply deal between Caracas and Washington, pressuring prices and leaving some volumes unsold, according to traders and shipping data.
Weak U.S. demand is an early setback to President Donald Trump’s hopes of sending most of the South American country’s oil to the United States since U.S. forces captured Venezuelan President Nicolas Maduro last month in a raid in Caracas.
Trading houses Vitol and Trafigura have been granted US licenses to market and sell millions of barrels of Venezuelan oil following the US operation and a subsequent supply agreement with interim president Delcy Rodriguez.
The trading houses, which have joined with energy major Chevron to hold approval to export Venezuelan oil, have struck some early deals to sell some commodities to refiners in the US and Europe. However, with Chevron also ramping up exports, trading companies are finding it harder to secure enough buyers among Gulf Coast refiners, traders said.
“We’re all facing this problem where there’s more to put and not enough takers,” one trader said, citing the reluctance of US refiners to buy Venezuelan crude. Some refiners complain that prices, while falling, remain high compared to competing Canadian heavy grades.
Venezuelan heavy crude for delivery to the Gulf Coast is being offered at about $9.50 a barrel below benchmark Brent, down from $6 to $7.50 a barrel in mid-January.
Last month, total Venezuelan oil exports to the US nearly tripled to 284,000 barrels per day (bpd), according to data based on tanker movements.
The U.S. was absorbing about 500,000 barrels a day of Venezuelan oil before Washington imposed sanctions on the country in 2019. But exports to the U.S. have reached zero in mid-2025 after Trump revoked all trade and transport licenses.
It will take time for U.S. refineries to reach maximum capacity again, one trader said, in part because some facilities would need adjustments to process heavier oil.
Phillips 66 Refinery Chief Executive Mark Lashier said on Tuesday that the company can process about 250,000 bpd of Venezuelan crude, but prices must be competitive for Venezuelan grades to displace other sources of heavy oil.
Chevron and Trafigura declined to comment. Venezuelan state oil company PDVSA and Vitol did not respond to requests for comment.
COMPETITION GROWS
Chevron, whose current Venezuelan license allows it to export only to the US, increased exports to 220,000 bpd in January from 99,000 bpd in December.
Chevron CEO Mike Wirth told investors on Friday that the company’s refining network can process up to 150,000 bpd of heavy material from Venezuela, meaning it must store or trade the rest among other refineries.
The firm, which is the only US oil company operating in Venezuela, produces about 250,000 bpd there. Wirth said the company sees potential for a 50 percent increase in production over the next 18 to 24 months, provided the U.S. gives it permission to expand operations.
Vessel monitoring data this week showed several Chevron-chartered tankers loaded with Venezuelan crude waiting days to unload at US ports or slowing sailing.
A person familiar with Chevron’s operations said the company had to negotiate new discharge dates with customers after a US blockade of Venezuela caused shipment delays between December and January. But all the merchandise had been sold before departure, the person added.
Meanwhile, Vitol and Trafigura exported about 12 million barrels – the equivalent of about 392,000 bpd – from Venezuelan ports in January, mostly to storage terminals in the Caribbean, the data showed.
Much of it has yet to be sold, sources said.
Venezuela’s total oil exports rose to nearly 800,000 bpd last month from 498,000 bpd in December.
China was previously the main destination for Venezuelan oil, but none has been sent there since Maduro’s capture in early January, according to the data. The US said after seizing Maduro that it would control Venezuela’s oil sales indefinitely.
While China is allowed to buy the oil, it must not be at the “unfair, undercut” prices at which Caracas previously sold crude, a US official said last month.
Beijing has rejected the US takeover of Venezuela’s oil exports.
China’s state-owned PetroChina, previously the biggest receiver of Venezuelan crude, has told traders not to buy or trade Venezuelan oil while it assesses the situation, separate sources told Reuters last week.
A possible safety valve for Venezuelan oil could come from India.
On Monday, Trump announced a trade deal with India that lowers US tariffs on Indian goods in exchange for India lowering trade barriers, ending its purchases of Russian oil and buying oil in return from the US and possibly Venezuela.
India’s Reliance Industries said last month it was considering importing Venezuelan oil.
(Serial and Marina Assembly Houston Shariq Khan in New York reports McCartney reporter or McCartney or
