Venezuela's state energy company PDVSA has begun reversing oil production cuts made under a strict US oil embargo as crude exports resume under US supervision, three sources close to operations said on Tuesday.
The OPEC member's oil exports fell close to zero in the weeks after the United States imposed a blockade on oil shipments in December. Only US oil major Chevron exported crude from its joint ventures with PDVSA under US licence.
The embargo left millions of barrels stuck in onshore tanks and vessels. As storage filled, PDVSA was forced to shut wells and order oil production cuts at joint ventures in the country.
The state company is now instructing the joint ventures to resume output from well clusters that were shut as a third oil tanker set sail from Venezuela's coast on Tuesday. Two supertankers had departed Venezuelan waters late on Monday carrying about 1.8 million barrels each of crude.
This may be the first shipments of a 50-million-barrel supply deal between Caracas and Washington to get exports moving again. This follows the US capture of Venezuelan President Nicolas Maduro.
The country's overall crude output fell to some 880,000 barrels per day (bpd) last week, from 1.16 million bpd in late November. This is according to production figures from consultancies that independently track Venezuelan oil output.
The country's main oil region, the Orinoco Belt, saw a reduction to some 410,000 bpd compared with 675,000 bpd in late November, according to the figures. PDVSA has yet to confirm that the supply deal for the 50 million barrels has been finalised.
The state company had worked to prevent deeper output reductions that might be difficult to reverse, given that production facilities at some oilfields are dilapidated due to lack of maintenance. PDVSA and the White House did not immediately reply to requests for comment.
The vessels on Tuesday were heading north from Venezuela's coast to the Caribbean, LSEG ship tracking data showed. This is where many oil companies including traders, producers and refiners lease storage tanks.
One of the ships was signalling a terminal in the Bahamas as its destination. Global trading houses Trafigura and Vitol last week obtained US licences to negotiate and trade Venezuelan oil cargoes.
This was an early win in the fierce competition between energy companies to secure Venezuelan barrels. The trading companies have not disclosed the volume of exports they are entitled to.
However, refiners in the US and in countries including India and China have begun negotiations to buy cargoes from the traders. They may also buy through tenders that have yet to be organised.
(Reporting by Marianna Parraga and Reuters staff; additional reporting by Jarret Renshaw. Editing by Simon Webb, Nathan Crooks, Julia Symmes-Cobb and Louise Heavens)
