Exclusive: Venezuelan Maduro seeks OPEC help against US sanctions – letter

MOSCOW / LONDON (Reuters) – Venezuelan Nicolas Maduro has sought OPEC support against US sanctions imposed on his country's oil industry, citing their impact on oil prices and potential dangers to other members of the producer group.

Venezuelan President Nicolas Maduro attends a military exercise in Charallave, Venezuela February 10, 2019. Miraflores Palace / Handout via REUTERS

But a source familiar with the matter said the organization of the petroleum exporting countries, where Venezuela is a founder, had refused to do so some formal statement. OPEC says it is concerned about oil policy, not politics.

More than 40 nations, including the United States, European forces and most of Latin America, have recognized Maduro's rival, Juan Guaido, as the country's judicial head of state, after disputed elections last year.

The request was made in a letter sent to OPEC Secretary-General Mohammad Barkindo dated January 29 and seen by Reuters, one day after the US imposed sanctions on the Venezuelan state oil company PDVSA.

"Our country hopes to receive solidarity and full support from the member countries of OPEC and its ministerial conference, in the struggle we currently face against the illegal and arbitrary US intrusion into Venezuela's internal affairs" Maduro wrote.

I am seeking "your firm support and cooperation to convene and meet this shameless solution of … important assets of one of OPEC's members," the letter said.

He wrote that OPEC will help determine potential solutions based on "the impact of this action on the global energy market and the risks it represents for the other countries … of this organization".

The sanctions in Venezuela have increased global oil prices, which traded at around $ 62 a barrel on Monday. The move has disturbed shipments as more than 20 tankers loaded with Venezuelan oil have been anchored by the US Gulf Coast.

Nevertheless, analysts say there is plenty of spare capacity in other oil producers such as Saudi Arabia plus strategic reserves in consumer nations to compensate for the loss of Venezuela's exports.

OPEC tends to avoid political disputes involving some members. Last year, it rejected a request from Iran for a discussion of US sanctions against Tehran at a policy setting meeting.

Venezuela was once a top three OPEC oil producer, but production has been declining for years after the collapse of the country's economy.

Energy research and consulting firm Rystad sees that Venezuelan production falls to 680,000 barrels a day (bpd) next year, from 1.34 million bpd at the end of 2018. Venezuela pumped 3 million bpd by the turn of the century.

Along with Libya and Iran, Venezuela is exempt from the latest OPEC-led supply cut due to involuntary decline in production.

Editing by Dale Hudson and Louise Heavens

Our Standards: Thomson Reuters Trust Principles.

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