Oil-state Senators Advise Against US Ban on Venezuela OilVOA - Friday 11th August, 2017
The United States sanctioned President Nicolas Maduro and other Venezuelan officials after Maduro established a constituent assembly run by his Socialist Party loyalists and cracked down on widespread opposition. It has not placed sanctions on the OPEC member's oil industry.
Senators John Cornyn of Texas, Bill Cassidy of Louisiana, and Thad Cochran and Roger Wicker of Mississippi said in the letter, which was seen by Reuters, that unilaterally blocking oil exports could harm the U.S. economy and the Venezuelan people.
The United States imports about 740,000 barrels per day of oil from Venezuela.
The White House did not respond to a request for comment on the letter, which was addressed to President Donald Trump.
"We believe it is critical to consider the role the U.S. energy industry and refining sector play in our economic and national security interest," the senators wrote. "Blockading imports could inflict great harm on this industry and burden U.S. taxpayers with the cost."
Effects on Venezuela
The senators said sanctions on shipments of Venezuelan oil to the United States could also increase the likelihood of a disorderly default by Venezuela, given the oil business is its main source of revenue. Creditors could then seize Venezuelan oil assets and cut off the government's remaining sources of financing.
They also noted that such sanctions could expand the interests of China and Russia in Venezuela's oil business. Both countries have invested in Venezuela for years.
Sources have said the United States could use heavy crude from its Strategic Petroleum Reserve held in caverns along the Gulf Coast, to relieve any short-term supply pressure if Venezuela's shipments were blocked. Nearly 680 million barrels of oil are in reserve.
A drilling boom in the United States has allowed the government to store more oil than it needs to meet international spare supply agreements.