Venezuela reducing oil to U.S. refineries on OPEC cut

Venezuela is reducing crude shipments to U.S. refineries Chalmette and Sweeney to comply with its OPEC output cut of 189,000 barrel per day, the Energy Ministry said on Wednesday. The two refineries are joint ventures between Venezuelan state oil company PDVSA and U.S. oil companies ConocoPhillips and Exxon Mobil, which are suing Venezuela for its 2007 takeover of Orinoco belt projects they once ran.

The statement said PDVSA had warned clients to make provisions for reduced supply, "in particular the refineries Chalmette and Sweeney, because it will be impossible for us to supply them with the usual volumes." Exxon Mobil said in an emailed statement that it does not generally discuss supply arrangements but said it "expects to be able to meet its contractual commitments."

Venezuela announced last year it had stopped sending crude to Chalmette and was
rerouting the oil to China after Chalmette operator Exxon Mobil won temporary
court orders freezing $12 billion in PDVSA assets.

Venezuela said 90,000 barrels per day (bpd) of the cut would come from the Petromonagas project, a joint venture between PDVSA and BP that upgrades tar-like Orinoco crude into lighter synthetic crude. Another 13,000 bpd will be cut from Petrocedeno, which includes investment from Norway's Statoil and France's Total.