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Latin America looks to Venezuelan fuel cargoes as Harvey hits U.S.

Staff Writer |
After Hurricane Harvey roared into Texas, flooding oil refineries and crippling ports along U.S. Gulf Coast, Latin American countries scouring the globe for other sources of fuel are zeroing in on a flotilla waiting to unload off the coast of Venezuela.

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Almost no fuel tankers have sailed from Texas for Latin America in six days, according to Thomson Reuters vessel tracking data.

Terminals and refineries shut by the storm are unlikely to fully recover for weeks.

Latin America's top recipients of U.S. fuel shipments are Mexico, Brazil and Venezuela, which is an OPEC member sitting on the world's largest crude oil reserves. However, Venezuela refineries are in such poor repair that the country cannot meet its domestic fuel needs.

On Tuesday, a trading firm with two cargoes of diesel waiting to discharge in the port of Curacao notified Venezuela's state-run oil company PDVSA it plans to suspend its delivery contract and divert the shipments to Ecuador, according to a PDVSA source familiar with the firm's international trade.

Mexico, Brazil, Colombia and other countries also want to tap some of the about 7 million barrels of fuel sitting in the Caribbean sea, according to three traders and shippers.

Some of the two dozen tankers sitting offshore have been waiting for weeks to discharge, either because cash-strapped PDVSA has been slow to pay for fuels or because of bottlenecks at ports.

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