Venezuela to ship sanctioned oil to US indefinitely, sources say

Venezuela will ship sanctioned oil to the United States indefinitely, sources close to the White House told CNBC on Wednesday.

President Donald Trump said Tuesday that Venezuela would hand over between 30 and 50 million barrels of sanctioned oil, which will be sold at market prices.

“This money will be controlled by me, as president of the United States of America, to ensure that it is used for the benefit of the people of Venezuela and the United States,” he added. Trump said in a post on social media.

The 50 million barrels are only the first tranche and shipments will continue indefinitely, the sources said. US sanctions on Venezuela will be lifted selectively to allow the oil to be transported and sold on global markets, the sources said.

Proceeds from oil sales will be paid into accounts controlled by the United States, the sources said, with the money returned to Venezuela at the discretion of the United States, they said.

Energy Secretary Chris Wright later confirmed the plan at a conference hosted by Goldman Sachs in Miami on Wednesday.

“We are going to market the crude coming from Venezuela,” Wright said. “First, this oil saved and stored, then indefinitely, in the future, we will sell the production that comes out of Venezuela on the market.”

Previously, sanctioned oil was destined primarily for China, but will now be redirected to the United States. Trump said Tuesday that the storage ships would transport the oil directly to receiving docks in the United States.

Venezuela, a founding member of OPEC, has the largest proven crude oil reserves in the world. But it only produces about 800,000 barrels per day, according to data from energy consultancy Kpler. The United States, on the other hand, currently produces around 13.8 million bpd.

Trump made clear that U.S. investment in Venezuela’s oil sector was a central goal of the military action that toppled the president. Nicolas Maduro last Saturday. The president has called on major U.S. oil companies to rebuild the South American nation’s energy infrastructure system, from wellheads to pipelines, although the companies have so far remained largely silent.

Wright will meet with oil executives about Venezuela at the Goldman conference.

“Secretary Wright remains in close contact with U.S. oil companies and plans to meet with several of them on Wednesday at the Goldman Sachs Energy Conference in Miami,” an Energy Department spokesperson told CNBC.