The Biden administration in the US is planning to ease sanctions on Venezuelan oil in an attempt to move more crude into Europe.

Sources familiar with the matter told the Bloomberg news agency that European companies still operating in Venezuela will be able to divert more cargoes across the Atlantic, in an easing of sanctions.

US oil company Chevron will also be permitted to negotiate a resumption of its operations in the South American country.

The news will be a boost for beleaguered crude tanker owners, potentially increasing tonne-miles and taking business away from the “rogue” fleet of elderly vessels prepared to do business with Venezuela and Iran.

The US-backed Venezuelan opposition supports the move, the source said.

Tightening oil supplies are threatening to cause a further spike in prices.

This latest move would also help European countries replace crude usually supplied by Russia.

Italy’s Eni and Spain’s Repsol are the only major European producers with operations in Venezuela.

Sources said they are working with the Biden administration to divert Venezuelan oil bound for China to Europe.

And Chevron would hope to restart talks with state oil producer PDVSA over a new licence for drilling.

This signals that Venezuelan oil may be coming to the US, a source said.

Permission confirmed

Venezuela vice president Delcy Rodriguez confirmed that the US government has authorised US and European oil companies to “negotiate and restart operations” in Venezuela, according to a post on her Twitter account.

VLCC rates remain under pressure, but one broker noted that owners with high-quality tonnage are resistant to rates falling any further.

Clarksons Platou Securities cites VLCC eco-earnings at $7,400 per day, down 4% from Wednesday.

The price differential between low and high-sulphur fuel has widened again after narrowing significantly.

In early March, the scrubber premium for a non-eco VLCC reached $14,000 per day before falling to $3,000 by the end of April.

Clarksons Platou now estimates this premium to be $9,600 per day.