Venezuela Oil Sector Braces For Loss Of US License

• Days after the United States announced it would reimpose costly limits on Venezuela's oil sector, the South American nation braced for the consequences and its president warned that the "grave error" would also hit U.S. interests.
• Announced by U.S. officials, Venezuela's loss of a key U.S. license that allowed it to freely export and increase investment in its oil sector will hit the volume and quality of its crude and fuel sales, while prompting a flurry of requests for individual U.S. deal authorisations.
• Washington had warned it would not renew so-called license 44, absent progress by President Nicolas Maduro toward implementing an electoral roadmap agreed with opposition leaders last year that sought to ensure free and fair elections this year.
• Speaking at the Caracas headquarters of state oil company PDVSA, Maduro criticized the administration of U.S. President Joe Biden for making good on its "blackmail threat" in an address broadcast on state television.
• Venezuela's economy is suffering a long-running crisis, though the government has made strides on inflation control in the last year, bringing usually triple-digit 12-month figures down to about 68% in March.
• The country's prior six-month license did not provide enough time for Venezuela to secure long-term energy investments, but companies already in the country were negotiating expansions and projects linked to existing joint ventures with PDVSA.
• The loss of the U.S. oil license now raises questions about whether there will still be a push from Venezuela to control Guyana’s oil-rich territory, the Essequibo region, or whether the country will try to employ a more peaceful stance over the near term to maintain other global ties.

(Sources: Reuters & NCBCM Research)