(Bloomberg) — PetroChina Co. is set to receive a cargo of Venezuelan oil, which will be used at its mega refinery in Guangdong, after the US rolled back sanctions on the OPEC producer late last year.
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The cargo of Merey crude is expected to be discharged over the weekend, but the Chinese oil major is unlikely to make further purchases if US sanctions on Venezuela are reinstated, according to people familiar with the matter. They asked not to be named because the information is private.
China officially resumed imports from the South American producer in February, the first time since 2019. Unofficially, the world’s top crude importer has been frequently taking Venezuelan oil over the years, according to traders and third-party data providers. Oil has often been masked as bitumen mix.
The company responsible for media queries relating to PetroChina — China National Petroleum Corp. — didn’t immediately respond to an email and text message seeking comment.
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The US suspended sanctions on Venezuela last year in a response to democratic developments in the country. However, penalties could be reinstated after President Nicolás Maduro agreed to run for a third term this July in an election he is all but assured victory after disqualifying his main rival.
The Guangdong refinery in Southern China was a joint venture with state-run Petróleos de Venezuela SA, and Merey was supposed to make up half its crude supply. In 2019, PetroChina dropped PDVSA from the project because of the deteriorating financial status of the company.
The refinery started commissioning in early 2023 and PetroChina sourced heavy crude oil supplies from Canada, Colombia and Ecuador for the plant after US sanctions disrupted access to Merey. The Venezuelan grade is now being offered at close to a $10 discount to ICE Brent, according to traders.
The very large crude carrier Elysia — which is carrying the cargo for PetroChina — is due to discharge at Jieyang port on Saturday, according to ship-tracking data compiled by Bloomberg. The vessel departed Jose oil terminal in early February.
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