Marianna Pararaga and Mircely Guianipa

HOUSTON/CARACAS – Venezuelan petroleum exports declined by around 4% from March last year, as Venezuela’s state-owned oil company handled crude cargoes returned from customers for poor oil quality. Documents and data on vessel monitoring showed that.

In March, a high-level US and Venezuelan meeting took place in Caracas. This opened up the possibility of talks on easing the sanctions Washington has placed since 2019 against Venezuela’s oil sector.

This prospect led to Petroleos de Venezuela, a state-owned oil company, and foreign firms taking measures in anticipation of rising oil exports.

The export data however showed that PDVSA was still struggling from years of bad management and lack of basic maintenance of key infrastructures for producing, upgrading and refining oil, as well as storing it.

According to data from Refinitiv Eikon and internal PDVSA documents, March saw the shipping of an average 644,419 barrels of crude oil and refined products per day by the joint ventures. This was slightly lower than the previous month, and less than the same month in 2021.

After the customer complained that the Petropiar joint venture produced diluent oil, PDVSA returned the cargo to the customer. An internal document from state company PDVSA showed that the customer had reported the shipment as being “off specification”. Similar issues led to another cargo being returned in February.

PDVSA didn’t respond to our request for comment.

Russia’s invading of Ukraine, and the related sanctions that have reshuffled global oil flows, has raised expectations for Venezuelan production returning to traditional markets. This is especially true after its suspension of Venezuelan exports to America three years ago due to sanctions against PDVSA.

Venezuelan firms are including foreign companies in discussions to purchase and lease tankers for their oil needs. Chevron Eni, Repsol (OTC) and Corp (NYSE:) all pressed for operating licences and authorizations to obtain Venezuelan oil in the event of lifting U.S. sanctions.

According to data, March’s lower crude production enabled the company drain some of its stockpiles. The February data were lowered in order to account for cargos that were not yet set sail.

PDVSA tried to restart the Petromongas crude upgrader, which is critical to convert its heavy crude into exportable grades. But, at month’s close, it was still down, according to documents.