Oil prices declined after the US President announced on Wednesday a deal under which Venezuela would export $2 billion worth of crude oil to the United States, a move expected to expand supply to the world’s largest oil consumer.
On Tuesday, the US President said on social media that Venezuela was “going to supply” between 30 million and 50 million barrels of “sanctioned oil” to the United States.
However, according to BMI, a division of Fitch Solutions, the possibility of increased oil exports from Venezuela at cheaper prices could stifle growth in production capacity in the US and elsewhere. Venezuela is offering its primary crude oil grade, Merey Brent crude, at its ports for supply at a discount of approximately $22 per barrel compared to the benchmark price.
