Expanded US licences for Venezuela-related deals are expected to restore the South American country's oil production by mid-2026 to levels seen before a US naval blockade in December, the US Energy Information Administration said on Tuesday.
Venezuela's state oil company PDVSA was forced to make deep output cuts after Washington imposed the strict naval blockade to pressure Nicolas Maduro, the Venezuelan president captured by US forces in early January.
The blockade cut off Venezuela's ability to export oil, leading to millions of barrels of crude building up in onshore tanks and vessels. Venezuela had been producing around 1.1 million to 1.2 million barrels per day of crude before the blockade.
PDVSA has since reversed most of the cuts, lifting output to close to one million bpd, after the US Government last month authorised commodities traders Vitol and Trafigura to join oil major Chevron in exporting Venezuelan oil, helping clear the storage buildup.
The traders have stored much of the oil in Caribbean terminals, from where it is likely to be shipped to refineries on the US Gulf Coast, the EIA said.
Washington also issued an expanded general licence late last month, allowing more companies to transport and sell Venezuelan oil. The move should ease production shut-ins and enable output to return to pre-blockade activity by the end of the second quarter this year, the EIA said.
Global oil production growth is meanwhile expected to outpace demand over the EIA's forecast period through the end of 2027, raising inventories and putting pressure on prices, the agency said.
The EIA expects Brent crude to average $57.69 a barrel this year, a three per cent increase from its prior forecast of $55.87 but still well below last year's average of about $69, it said in its short-term energy outlook report.
Brent is forecast to fall further to around $53 a barrel next year, it said. US oil output is now projected to average a record 13.60 million bpd this year, about 10,000 bpd above the prior forecast, the EIA said.
Output from the world's top producer is expected to ease to about 13.32 million bpd in 2027, it said. Total world crude and liquid fuels production is forecast to average 107.8 million bpd, up about 100,000 bpd from the previous estimate, the EIA said.
(Reporting by Shariq Khan in New York Editing by Rod Nickel and Mark Potter)
