President Donald Trump has claimed that Venezuela’s interim authorities will be shipping several million barrels of sanctioned crude oil to the United States, after U.S. forces captured the country’s President Nicolás Maduro over the weekend.
Venezuela To Ship Over 50 Million Barrels of Crude Oil
In a Truth Social post on Tuesday, Trump said that the Latin American nation will be “turning over” anywhere between 30 and 50 million barrels of “high quality, sanctioned oil” to the U.S.
Trump said that the oil will be sold at market prices, and the proceeds will be controlled by him and used to “benefit the people of Venezuela and the United States.”
“I have asked Energy Secretary Chris Wright to execute this plan, immediately,” he said, adding that the commodity will be transported on storage ships directly to unloading docks in the U.S.
This comes just days after Trump threatened more military interventions in the South American state if it fails to cooperate with his efforts to “fix” its economy. Referring to Venezuelan Vice President Delcy Rodriguez, who is now the country’s interim leader following Maduro’s capture, Trump said, “She will face a situation probably worse than Maduro.”
Crude Oil Prices Dip
Crude oil futures dipped on Trump’s announcement, with WTI Crude futures for February delivery trading at $56.42 per barrel, down 1.24% on Tuesday night, with the potential new supply adding fresh downward pressure on prices.
Based on the latest market price, the administration could expect gross proceeds worth nearly $2.8 billion from the deal. However, it is worth noting that Venezuela’s heavy crude typically trades below international benchmarks such as the West Texas Intermediate, which is predominantly a light, sweet oil grade.
The United States Oil Fund LP (NYSE:USO), which is designed to track the daily prices of crude oil, was down 2.44% on Tuesday, trading at $68.51, and is down 0.96% overnight.
The fund scores poorly on Momentum in Benzinga’s Edge Stock Rankings, with an unfavorable price trend in the short, medium and long terms. Click here for deeper insights into the fund.
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