Venezuelan crude and fuel shipments dropped sharply in July as Indian refiners stepped back from the heavy barrels they had been buying all spring, according to tanker-tracking data and shipping documents reviewed by trade reporters. The pullback traces directly to the pause in fighting between Washington and Tehran, which briefly unlocked the Middle Eastern cargoes that had been bottled up inside the Persian Gulf.
The reversal is striking given how fast Venezuela had climbed back. Exports ran at roughly 1.2 million barrels per day in June, easing slightly from 1.24 million bpd in May, with shipments to the United States rising to 630,000 bpd and volumes to India slipping to 277,000 bpd. Chevron moved about 293,000 bpd of Venezuelan crude that month, while trading houses including Vitol and Trafigura handled some 775,000 bpd. Those figures represented the strongest run for the OPEC member in years, well above the 2025 average of 847,000 bpd.
India had been the swing buyer holding that recovery together. When the war shut down Gulf shipping earlier this year, Indian refiners scrambled for replacement grades and turned to Venezuela’s discounted heavy sour crude. That calculus changed once the guns went quiet. A 60-day ceasefire signed in mid-June reopened the strait without tolls and required Iran to clear mines. In the roughly three weeks the Strait of Hormuz stayed open, more than 200 million barrels escaped the Persian Gulf — the equivalent of about 17 weeks of supply hitting the market at once, according to Andy Lipow of Lipow Oil Associates.
For a refiner in Gujarat, that flood of familiar Middle Eastern grades removes most of the reason to pay for a five-week voyage from the Caribbean. Venezuelan Merey 16 is a difficult crude that only a handful of complex refineries can process economically, and its appeal has always rested on the discount. When Gulf barrels are available and moving, the discount has to widen considerably to keep Indian buyers at the table.
The American side of the trade tells a different story. U.S. refiners have been steadily deepening their positions in Venezuela even as Asian demand wobbles. Chevron lifted about 293,000 bpd of Venezuelan crude in the second quarter, up from 223,000 bpd in the first, as part of its push to expand output and exports there. Phillips 66 resumed spot purchases from PDVSA in May after a seven-year gap and was allocated three cargoes of Merey 16 at the Jose terminal in July. Reliance Industries began buying directly from PDVSA in May, and Valero Energy is expected to begin direct purchases in the coming months, though it had not been assigned loading windows as of mid-July.
That shift matters more than the monthly export headline. Refiners signing direct term contracts are less likely to walk away when Gulf supply loosens than traders reselling opportunistically. The more of Venezuela’s output that is locked into contracts with Gulf Coast and European refineries, the less the country’s revenue swings with every turn in the Iran conflict.
The oil market has been swinging violently regardless. Brent closed July at $87.93, up more than 20 percent over the month, after the pause in fighting collapsed, Yemen’s Houthis widened their involvement, and Saudi forces joined U.S. operations against Iran-backed groups in Iraq. Then on Monday, Brent tumbled more than 7 percent in early Asian trading to below $84 a barrel and WTI fell under $81 after President Trump said he had called off a planned large-scale strike on Iran and that fresh negotiations would begin, following appeals from Middle Eastern allies including Saudi Arabia. OPEC+ has also been adding supply, with the group’s seven core members raising output by 188,000 bpd for August, the fifth consecutive monthly increase.
For tri-state businesses, the July drop in Venezuelan flows is less important than what it signals: the market has entered a phase where each diplomatic headline resets fuel costs within hours. Trucking firms, distributors, and building operators across New York and New Jersey have spent the summer trying to budget against a benchmark that moved 20 percent in one direction in July and 7 percent the other way in a single Monday session.
The underlying supply picture is loosening — more Venezuelan barrels under American contracts, more OPEC+ output, and Gulf cargoes moving whenever the strait stays open. What has not loosened is the risk premium’s tendency to snap back the moment talks stall. Venezuela’s July numbers are a reminder that in this market, even a two-week pause in a war rearranges trade routes on the other side of the world.
JBizNews Desk | New York
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