A source close to the White House told CNBC on Wednesday that Venezuela plans to continue shipping sanctioned oil to the United States indefinitely.
President Donald Trump announced Tuesday that Venezuela would take delivery of 30 million to 50 million barrels of sanctioned oil and sell it at market price.
“The funds will be managed by me as President of the United States to ensure they are used to benefit the people of Venezuela and the United States,” Trump said in a social media post.
Sources said the 50 million barrels would be just the first tranche and shipments would continue indefinitely. U.S. sanctions on Venezuela will be lifted selectively to allow the shipment and sale of crude oil on global markets, sources said.
Proceeds from oil sales will be settled into U.S.-controlled accounts and returned to Venezuela at the U.S. discretion, sources said.
Energy Secretary Chris Wright later confirmed the plan Wednesday at a conference hosted by Goldman Sachs in Miami.
“We’re going to market the oil that’s coming out of Venezuela,” Wright said. “First of all, this will back up and store the oil, and then indefinitely, we will sell the production coming out of Venezuela into the market.”
Previously, most of the oil subject to sanctions went to China, but now it will be rerouted to the United States instead. President Trump said Tuesday that storage ships will transport the oil directly to receiving ports in the United States.
Venezuela is a founding member of OPEC and has the world’s largest proven oil reserves. But production remains at around 800,000 barrels per day, according to data from energy consulting firm Kpler. In contrast, the United States currently produces about 13.8 million barrels per day.
President Trump has made clear that US investments in Venezuela’s oil sector are a central objective of the military action that ousted President Nicolas Maduro last Saturday. The president has called on major U.S. oil companies to rebuild South America’s energy infrastructure system, from wellheads to pipelines, but the companies have so far remained largely silent.
Wright is scheduled to talk about Venezuela with oil company executives at the Goldman conference.
“Secretary Wright remains in close contact with U.S. oil companies and is scheduled to meet with several at the Goldman Sachs Energy Conference in Miami on Wednesday,” a Department of Energy spokesperson told CNBC.
