US oil service firms eyeing Venezuela return

Washington could lift a ban on US oilfield service firms from operating in Venezuela amid growing pressure to ease supply fears caused by an embargo on Russian energy imports. 

Company executives are lobbying Washington to allow the resumption of operations with Venezuelan state oil company PDVSA and joint-venture partner Chevron, according to Reuters, which cited eight sources with knowledge of the talks. 

If the move is approved, Venezuela could raise crude production by around a third of its current level to 1Mb/d (million barrels) within weeks, according to industry observers.

The service companies understood to be involved in the talks are Schlumberger, Halliburton, Baker Hughes and Weatherford International. 

The companies have been prohibited from working alongside PDVSA and its partners since 2019. 

Last month, senior US officials met with Venezuelan counterparts in Caracas in an apparent effort from Washington to resume diplomatic and economic ties with the South American country.

The meeting came days after President Joe Biden signed an executive order barring imports of Russian oil, liquefied natural gas and coal to the US in response to Moscow's invasion of Ukraine. 

Before the order was issued, Russian crude and its derivatives accounted for around 8% of US energy imports, leaving a void that experts say could be partially filled by Venezuela. 

Despite sitting on the world's largest proven oil reserves, Venezuela has seen production plummet over the past two decades amid severe political turbulence, widespread corruption at PDVSA and crippling US sanctions.