The rising supply of U.S. shale oil doesn’t affect exporters of medium and heavy crudes such as Venezuela, the Latin American country’s oil minister told reporters before an OPEC meeting tomorrow.
“Shale is a production of light crude and that doesn’t affect us as being big producers of medium and heavy crudes,” Rafael Ramirez said in Vienna, where ministers from the Organization of Petroleum Exporting Countries are gathering. “We have a big capacity to place our crudes, including the U.S. market.”
The prospect of growing U.S. energy independence has come to the fore amid a reduction in U.S. crude imports from some OPEC nations, notably those in Africa, over recent months. At a time of weak economic growth and rising U.S. production, OPEC nations risk a price decline unless they cut supply themselves, according to Societe Generale SA and the Centre for Global Energy Studies.
Five months ago, after OPEC’s mid-December meeting, the group’s secretary-general, Abdalla el-Badri, fended off questions about burgeoning U.S. shale oil supply, saying: “We’re not really concerned. I don’t see that big a quantity.”
Venezuela’s Ramirez said diversification avoids competition with the growing supply of lighter oil from shale deposits.
“Long time ago we decided to diversify our markets and good for us we did it,” he said. “We sell to China, Japan, countries that have sustained growth like India with the capacity to process heavy crude.”