Aletho News

Vitol tests Chinese demand with narrower discounts on Venezuelan crude

Al Mayadeen | January 19, 2026

Vitol Group has offered Venezuelan crude oil cargoes to Chinese buyers at discounts of around $5 per barrel to ICE Brent, signaling a bid to test Chinese firms’ demand for the Latin American country’s heavy, sour grades, Bloomberg reported, citing traders familiar with the matter.

If deals go through, the cargoes are expected to be delivered in the second half of April, traders said. The move underscores renewed efforts by major US-based trading houses to place Venezuelan barrels in Asia, with China remaining a key destination.

Venezuela’s Merey crude has historically been among the cheapest globally, with Asia, particularly China, absorbing large volumes. Before US President Donald Trump ordered the abduction of Venezuelan President Nicolas Maduro, discounts on delivered barrels to Brent were as wide as $15 per barrel. The narrower spread now being tested suggests a recalibration of pricing after the US allowed for larger sales of Venezuelan crude, revenues it seeks to exploit. In recent years, Vitol has operated under licenses issued by the US Treasury that allow the loading and sale of Venezuelan crude. Under this imposed framework, proceeds from oil sales are directed into US-controlled bank accounts, a mechanism Washington claims is intended to manage revenues of Venezuela’s oil industry.

Marketing stolen oil

However, the deal only took effect after Maduro was kidnapped, oil tankers were stolen, and Venezuelan authorities were threatened. Vitol also gained preferential treatment, securing a deal it could only dream of to sell Venezuelan crude. The granting of an 18-month license to Vitol to market stolen crude triggered sharp controversy in Congress and across the energy sector.

Concerns center on the speed of the approval and Vitol’s political connections, which include reports that senior Vitol trader John Addison had donated more than $5 million to Donald Trump’s 2024 re-election campaign and attended a high-profile White House meeting with oil executives days before the roughly $250 million deal was awarded. US Senator Tim Kaine said the arrangement was “smacking of corruption,” questioning why proceeds were routed to specific bank accounts and who ultimately stood to benefit from the administration’s plan to effectively “run” Venezuela’s oil sales. The fact that Vitol and Trafigura were the first firms to receive such licenses, while other traders remained barred under sanctions, fueled accusations of “transactional diplomacy”.

The Trump administration and industry analysts rejected the allegations, arguing that Vitol and Trafigura were selected for practical reasons. US officials cited the traders’ vast shipping fleets and global logistics networks as essential for rapidly moving large volumes of stranded crude.

Indian, Chinese refiners seek clarity over Venezuelan crude

On January 12, Vitol and Trafigura were reportedly holding early-stage discussions with leading refiners in India and China over potential sales of Venezuelan crude. Bloomberg, citing people familiar with the matter, reported that the two trading giants contacted large Asian buyers over the weekend, though talks remained exploratory and no formal offers were made. Both firms are also gauging interest among US refiners.

India’s Reliance Industries previously imported Venezuelan oil under a waiver before halting purchases last year following a decision by Trump to impose a 25% tariff on countries buying oil from Venezuela.

India’s state-owned Indian Oil Corp. (IOC) is among the companies awaiting confirmation from Washington that it has been cleared to resume purchases of Venezuelan oil, according to Bloomberg‘s sources. IOC declined to comment. Reliance Industries said last week it was seeking clarity on whether non-US buyers could access Venezuelan crude and stated it would consider purchases “in a compliant manner.”

It remains unclear how much oil Vitol and Trafigura would be able to sell, or whether transactions would be limited to the initial tranche referenced by Trump. Nevertheless, any sales would mark a significant development for trading houses with longstanding involvement in Venezuela’s oil sector.

January 19, 2026 - Posted by aletho | Economics, War Crimes | China, United States, Venezuela