As we saw earlier this week, the benchmark price of West Texas Intermediate oil in the United States created an unprecedented day in which it traded negatively for the first time in its history.
Something that reflects the very saturated state of the crude oil market.
And at the height of this crisis, unsurprisingly, Trump reappeared with an iron stick in his hand.
Yes, the iron baton orders petrochemical companies to close their operations and gives them until December to leave Venezuela.
The Office of Foreign Assets Control, responsible for applying the sanctions, has renewed the licenses of the American oil companies which remain in joint venture with the Venezuelan PDVSA only until the end of the year, but it imposes strict restrictions.
In a license renewal permit signed by Andrea Gacki, director of this sanctioning department, it is granted to the Chevron companies; Halliburton; Schlumberger Limited; Baker Hughes and Weatherford International until December 1 to complete their maintenance operations.
But now drilling, processing, buying or selling of raw or derived products must stop.
The license expressly states that it does not authorize "the drilling, extraction or processing, purchase or sale, transportation or shipment of petroleum or petroleum products of Venezuelan origin". License issued by the United States. April 21, 2020.
It should be noted that Baker Hughes and Schlumberger are petroleum service companies and that without them the storage of crude oil in Venezuela, whose inventory is completely saturated, is even more complicated.
This American decision It is a heavy blow for the oil sector of Maduro, which is already short of storage for crude increasingly devalued.
It should also be noted that last year the White House approved a series of harsh sanctions against Venezuelan crude, ultimately imposing an embargo on imports from the United States. However, it has made a series of exceptions, granting temporary licenses to the aforementioned companies, so that they can collect the debt in their joint operations with PDVSA.
Other foreign companies remain in Venezuela, which also collect debts, such as the Spanish Repsol, the Italian Eni or the Indian Reliance, to which the American government has made known in various ways that they risk being penalized if they did not withdraw gradually. The Russian Rosneft recently withdrew after distributing two-thirds of the Venezuelan crude and having been punished twice in the United States. for him.
In your personal opinion, was it a wise decision or just a random outing? What will this decision imply at the height of the global crisis due to the Corona pandemic?