Energy Department: US does not consider using Venezuelan oil to fill strategic reserves as a current option.

Department of Energy, Friday, said that the U.S. Government is not considering the use of Venezuelan oil as part of an exchange with U.S. companies for the purpose of refilling the country's Strategic Petroleum Reserve.

On Friday, two sources reported that the Trump administration was exploring an exchange plan to deliver Venezuelan crude oil to U.S. refining plants in exchange for U.S. produced crude. The U.S. oil would be used to fill the 'SPR', the world’s largest emergency stockpile of oil, located in underground caverns along the Texas and Louisiana coasts.

A spokesperson for the U.S. Energy Department said, "This is not true." "We do not plan to use Venezuelan oil for the refill of SPR at this time."

The spokesperson confirmed that there is currently no exchange planned.

Venezuelan crude is denser, and has a higher sulfur content than the crude oil that was previously used in the SPR.

Two sources claim that the Trump administration wants to ship the Venezuelan crude to refineries from the Louisiana Offshore Oil Port.

The two sources said that in exchange for Venezuelan crude, companies would provide U.S. medium-sour crude directly to SPR storage.

The U.S., after capturing Venezuelan president Nicolas Maduro in the first week of this month has announced that it will control Venezuela's oil revenue and sales for the foreseeable future. Trump promised to replenish the emergency reserve on the first day of his second tenure as part of an oil and gas policy.

The SPR holds approximately 414 million barrels of crude oil in underground salt caverns. This is about 60% its total capacity. The administration has been unable to fill the reserve because of lack of funds and maintenance.

Energy Secretary Chris Wright said that the Trump administration is exploring alternatives to replenishing the reserves without direct government spending, such as potential deals with private oil companies.

The bill included $171 million in SPR oil maintenance and purchases, a far cry from the original $1.3 billion.

(source: Reuters)