Valero Energy Corp, a U.S.-based refining company operating on the Gulf Coast, has completed a purchase of Venezuelan crude oil, according to two industry sources speaking on January 21. This acquisition is the first known instance of such a transaction involving a U.S. Gulf Coast refiner under an arrangement between Washington and Caracas that allows U.S. companies to buy up to 50 million barrels of Venezuelan crude.
The crude oil was procured from Vitol, a trading firm, confirming a significant shift in the mechanics of Venezuelan crude distribution. Previously, Valero's Venezuelan crude supply primarily came through Chevron, which maintains a partnership with the Venezuelan state oil entity. The current deal marks the initial purchase executed through trading houses, now authorized this month to market Venezuelan crude, thereby expanding the access channels to U.S. refiners.
The Venezuelan crude in question is the flagship Merey heavy grade, and initial offers to U.S. refiners were reported last week featuring prices discounted between $6 and $7.50 per barrel relative to Brent crude benchmarks. Valero's purchase reportedly involved discounts larger than this initial range, approximately $8.50 to $9.50 per barrel below Brent prices, highlighting competitive pricing dynamics as the market readjusts.
Prior to sanctions implemented in 2019, U.S. Gulf Coast refineries processed sizable volumes of Venezuela's heavy crude, estimated at around 800,000 barrels per day by U.S. government statistics. The resumption of purchases through trading channels reflects evolving geopolitical and commercial developments impacting oil supply chains and refinery feedstock sourcing on the U.S. Gulf Coast.