- Oil edges lower as US eases sanctions on Venezuela
- November ’23 WTI lost 67c this morning to trade around $87.65/Bbl
- Yesterday, crude prices reached a two-week high amid rising tensions in the Middle East, with both WTI and Brent closing over $1.60/Bbl higher
- the US Treasury temporarily lifted some sanctions on Venezuelan oil and other commodities in return for the promise of freer elections in the country
- Yesterday, the EIA reported a 0.8 MMBbl Cushing draw, with inventories reaching their lowest since October 2014 at 21 MMBbl, the perceived minimum operating level
- Additionally, the US 10 Year Treasury yield rally continues this week, nearing a 17-year high of 5%
- United States lifts sanctions on Venezuela's oil for six months (Bloomberg)
- Yesterday, the US granted Venezuela a six-month general license temporarily authorizing transactions to restore its under-invested oil and gas sector
- The six-month period is short, and the relief is contingent on President Maduro adhering to a democratic electoral pact
- Oil production in 2023 averages 0.75 MMBbl/d, an uptick from 2022’s 0.67 MMBbl/d but still short of the 2.4 MMBbl/d seen before the 2017 sanctions
- A Bloomberg survey of analysts estimates a 0.2 MMBbl/d increase in production; however, the country currently runs just one rig, a steep decline from 80 in 2017