Venezuela moves more oil exports away from U.S.

CARACAS (Reuters) - Venezuela has moved ahead with a strategy of diversification of oil exports by promising more fuel to Belarus and Syria and less to the United States, where President Hugo Chavez has hinted he would like to sell assets.

Oil Minister Rafael Ramirez said on Wednesday that South America’s top oil producer will boost crude oil exports to Belarus by 150 percent next year to 200,000 barrels per day.

State oil company PDVSA will also export 20,000 bpd of diesel to Syria, under an agreement signed by Chavez on a recent tour.

“We are aiming at reducing the spot market,” Ramirez told reporters. “We are signing long-term supply agreements.”

Ramirez rejected allegations by political opponents of Chavez who say Venezuela is missing out on revenue because of agreements that favor big overseas customers like China.

“We do not sell discounted oil to anyone ... We are sending oil to Belarus at prices above the market price,” he told reporters. “We have had an average price of $78 per barrel since April (for sales to Belarus), which is 60 cents above the WTI (West Texas Intermediate) price.”

Ramirez said Venezuela had stopped shipments of gasoline to Iran that were designed to skirt sanctions against Tehran for its nuclear program. He said Iran no longer needed the fuel.


During Chavez’s tour of Europe, Russia and the Middle East, PDVSA finalized the sale of its share in German refiner Ruhr Oel.

PDVSA had long sought to escape the German venture, which it said was not profitable. Now all eyes are on PDVSA’s U.S. subsidiary Citgo, which Chavez and Ramirez both call “bad business.”

Ramirez stopped short of saying he was seeking to sell the company, saying Venezuela was restricted by complicated overseas contracts.

“We will move ahead with this process little by little,” Ramirez said.

As part of the foreign tour this month, Chavez visited Minsk, where he agreed to supply the former Soviet republic with 30 million tons of oil over three years from 2011 in a deal worth as much as $19.4 billion.

Belarus has slashed imports of Russian Urals blend oil and increased purchases from the South American OPEC member since Moscow imposed export duties, a move that raised the price of Russian exports to Belarus by about 36 percent.

State statistics show Belarus is currently buying Venezuelan crude for $647 per ton, pricing 30 million tons at about $19.4 billion, according to Reuters calculations.

Belorussian President Alexander Lukashenko visited Venezuela in March in an effort to secure energy supplies after the flow of cheap crude from Russia to its neighbor dropped sharply.

Relations between the two former allies have deteriorated since Minsk gave refuge to a former Kyrgyz leader who is criticized by Moscow, and threatened to cut Russian oil and gas transit to Europe in a gas pricing dispute in June.

Belarus’s Mozyr refinery currently receives Venezuelan imports by rail from ports on the Baltic and Black seas.

But Belarus plans to reverse part of the Europe-bound Druzhba pipeline to let more Venezuelan crude reach Belarus from Odessa. Belarus refines the crude from Russia and Venezuela and then sells products to the European Union.

Writing by Daniel Wallis; Editing by Walter Bagley