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Eni, Repsol to Start Importing Venezuela Crude Oil to Europe
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Eni SPA (E - Free Report) and Repsol SA (REPYY - Free Report) could start shipments of Venezuela oil to Europe as early as the next month after the easing of restrictions on the country’s oil exports by the United States, per Reuters.
In January 2019, the United States imposed major sanctions on the Maduro government and prohibited crude oil imports from the country. Since then, the Venezuela state oil company PDVSA has been under a strict U.S. embargo.
Venezuela is a leading country in terms of proven oil reserves. Western countries seek alternative supplies after phasing out purchases of Russian oil over its aggressive invasion of Ukraine.
Eni has been operating in Venezuela’s offshore oil sector, while Repsol has a presence in the country’s onshore upstream sector for almost three decades. The companies will shortly be able to export a small quantity of the country’s crude oil to Europe markets.
The Biden administration expects the Venezuelan crude to help reduce Europe’s dependence on Russia and re-direct some of the country’s cargoes from China. Under the new settlement, Eni and Repsol will be able to extract Venezuela crude as repayments for past investments and export abroad. The transaction is conditioned upon the delivery to markets in Europe.
U.S. oil major Chevron Corporation (CVX - Free Report) had been urging to revoke the export ban. The U.S. Treasury Department is preparing to renew Chevron’s license to operate in Venezuela in the coming days. The company was among the largest buyers of Venezuela crude in the United States.
Chevron’s request to extract oil in exchange for past debts was denied. However, the administration hinted at probable ease in terms of CVX’s business in the country. The company, under a distinct authorization, will be permitted to engage in talks with PDVSA on its future operations in the country.
The U.S. administration upheld that it would grant a complete sanctions respite to Venezuela if president Nicolas Maduro and a coalition of opposition parties led by Juan Guiado pen down an agreement to hold fresh parliamentary and presidential elections in the country.
Company Profile & Price Performance
Headquartered in Rome, Italy, Eni is one of the leading integrated energy players in the world.
Shares of Eni have underperformed the industry in the past six months. The stock has gained 12.2% compared with the industry’s 42.3% growth.
Marathon Petroleum Corporation (MPC - Free Report) is a leading independent refiner, transporter and marketer of petroleum products. MPC is expected to witness an earnings growth of 350.2% in 2022. The company currently has a Zacks Style Score of A for Momentum, and B for Value and Growth.
The industry’s improved fundamentals in the form of constrained supply and robust demand have led to rising refining profitability for the players involved. As a reflection of this, Marathon Petroleum’s Refining & Marketing segment reported an operating income of $768 million in the first quarter, turning around from the year-ago loss of $598 million.
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Eni, Repsol to Start Importing Venezuela Crude Oil to Europe
Eni SPA (E - Free Report) and Repsol SA (REPYY - Free Report) could start shipments of Venezuela oil to Europe as early as the next month after the easing of restrictions on the country’s oil exports by the United States, per Reuters.
In January 2019, the United States imposed major sanctions on the Maduro government and prohibited crude oil imports from the country. Since then, the Venezuela state oil company PDVSA has been under a strict U.S. embargo.
Venezuela is a leading country in terms of proven oil reserves. Western countries seek alternative supplies after phasing out purchases of Russian oil over its aggressive invasion of Ukraine.
Eni has been operating in Venezuela’s offshore oil sector, while Repsol has a presence in the country’s onshore upstream sector for almost three decades. The companies will shortly be able to export a small quantity of the country’s crude oil to Europe markets.
The Biden administration expects the Venezuelan crude to help reduce Europe’s dependence on Russia and re-direct some of the country’s cargoes from China. Under the new settlement, Eni and Repsol will be able to extract Venezuela crude as repayments for past investments and export abroad. The transaction is conditioned upon the delivery to markets in Europe.
U.S. oil major Chevron Corporation (CVX - Free Report) had been urging to revoke the export ban. The U.S. Treasury Department is preparing to renew Chevron’s license to operate in Venezuela in the coming days. The company was among the largest buyers of Venezuela crude in the United States.
Chevron’s request to extract oil in exchange for past debts was denied. However, the administration hinted at probable ease in terms of CVX’s business in the country. The company, under a distinct authorization, will be permitted to engage in talks with PDVSA on its future operations in the country.
The U.S. administration upheld that it would grant a complete sanctions respite to Venezuela if president Nicolas Maduro and a coalition of opposition parties led by Juan Guiado pen down an agreement to hold fresh parliamentary and presidential elections in the country.
Company Profile & Price Performance
Headquartered in Rome, Italy, Eni is one of the leading integrated energy players in the world.
Shares of Eni have underperformed the industry in the past six months. The stock has gained 12.2% compared with the industry’s 42.3% growth.
Image Source: Zacks Investment Research
Zacks Rank & Stock to Consider
Eni currently has a Zack Rank #3 (Hold).
Investors interested in the energy sector might look at the following company that presently flaunts a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Marathon Petroleum Corporation (MPC - Free Report) is a leading independent refiner, transporter and marketer of petroleum products. MPC is expected to witness an earnings growth of 350.2% in 2022. The company currently has a Zacks Style Score of A for Momentum, and B for Value and Growth.
The industry’s improved fundamentals in the form of constrained supply and robust demand have led to rising refining profitability for the players involved. As a reflection of this, Marathon Petroleum’s Refining & Marketing segment reported an operating income of $768 million in the first quarter, turning around from the year-ago loss of $598 million.