Monday, June 6, 2011

Venezuela Cuts Relations with US over Iran Sanctions

Venezuela cut its relations with the US on Sunday in protest over Washington’s sanctions against the country’s oil company, Petroleos de Venezuela (PDVSA). US imposed penalties on PDVSA last month for delivering $50 million worth of gasoline to Iran in 2010. The sanctions bar PDVSA from export licenses for sensitive technology, US Ex-Im Bank financing and any US government contracts. The company can still sell oil to US private companies [, 6 June].


Unknown Unknowns said...

Besides being a slap in the face of Uncle Sam, how significant is this?

Anonymous said...

It is not very important at all.

The US is getting most of its heavy oil from Canada, it also has vastly increased its ability to refine heavy oils (cheaply). The US is taking so much heavy oil from Canada that by 2015 it may be at capacity unless more pipelines and even more refining capacity come online, Hugo has become Mr. Irrelevant!

Mexico is now starting to bring in US & foreign corporations to increase oil & gas production, North American Oil & Gas extraction tech brought to the fields will help Mexico's production quite a bit.

In five years from now I think you will see Mexican oil imports to the US up by more than 5%.

Anonymous said...

Venezuela currently supplies nearly 15% of total US oil imports. And anyone who thinks Mexico is going to significantly increase their oil output in the near future is delusional. Venezuela also has far more "heavy" oil than Canada, and it is cheaper to extract in Venezuela than in Canada. The sanctions are irrelevant, but if the US screws around, it might just lead to Venezuela cutting off supplies of oil to the US, which would cause significant problems and additional expense for the US.