First Venezuelan Oil Sold by the US Goes to Company Linked to Trump Donor

The first batch of Venezuelan oil sold by the United States went to a company linked to a major sponsor of President Donald Trump, The Financial Times wrote.

On January 15, the United States sold the first batch of Venezuelan oil worth a total of 500 million dollars. According to Semafor, the funds sit in several bank accounts. The American administration controls all of them, but it chose Qatar for the main account as a neutral venue with no risk of asset seizure.

The buyer turned out to be the trading company Vitol. Its senior trader, John Addison, donated about six million dollars to political committees supporting Trump. The contract for the purchase of Venezuelan oil stands at 250 million dollars. The remaining volume went to another major trader, Trafigura.

The US Department of Energy explained the choice of these companies by their readiness to make the first payments quickly.

Venezuela's Oil Wealth and Structural Problems

Venezuela holds the world's largest proven oil reserves, with about 300 billion barrels, more than Saudi Arabia. However, these resources bring little benefit to the country. Severe economic problems make extraction extremely difficult.

Before the conflict with the United States, Venezuela produced around one million barrels per day, placing it near the bottom of global rankings.

Trump confirmed that the United States plans to take Latin American resources into active use and allow American companies to operate in the republic.

"We are going to bring in our largest US oil companies, the biggest in the world. They will invest billions of dollars, restore severely damaged oil infrastructure, and start generating profits for the country,” Trump said.

Pressure on Energy Companies

As Politico reported, even before the conflict began, representatives of the Trump administration warned oil and gas executives that if they wanted compensation for assets previously lost in Venezuela, they would need to return to the country and invest heavily in restoring its deteriorated oil sector.

However, the scale of required investments remains unclear. One source told the newspaper that the infrastructure has deteriorated so badly that companies cannot realistically estimate how much funding restoration will require.

Export Restrictions and Market Impact

At the same time, Washington has kept restrictions on Venezuelan oil exports in place. The goal is to preserve leverage over Venezuela after the capture of Nicolás Maduro.

Exports from the country have effectively stalled. Ports do not receive permission to release loaded vessels. Several tankers bound for the United States and Asia never left port, while others waiting for cargo, including those at the country's largest port, José, departed empty.

In the short term, the oil blockade may put pressure on the share prices of both American and Venezuelan companies.

"The key losers will be companies from China and the United States that consumed this oil. Venezuela will also suffer, since most of its production, slightly more than one million barrels per day, went to export and supported the country's economy,” said independent expert Dmitry Lyutyagin.

He believes the situation will not last long and expects the countries to reach an agreement within a week.

Limits of Venezuela's Oil Potential

Experts also note that large proven reserves alone guarantee nothing. According to Stanislav Mitrakhovich, senior research fellow at the Financial University and energy expert, Venezuela currently produces very little oil and exports between 0.6 and 0.9 million barrels per day.

"The world consumes more than 100 million barrels per day. The existence of reserves does not mean they are commercially viable at the current level of technology and prices,” he said.

Production could theoretically rise to two million barrels per day, Mitrakhovich added, but not immediately.

"That would take at least a couple of years. For Venezuelan oil to become convenient and commercially effective, global prices must remain high. This would require all favorable conditions to align at the same time,” he concluded.