GAO sees vulnerability to Venezuelan oil cutoff

WASHINGTON — Tight oil markets and little spare production capacity worldwide make the United States more vulnerable today to a cutoff of Venezuelan oil than three years ago when a strike curtailed Venezuelan supplies, a congressional study warns.

The report by the Government Accountability Office says a Venezuelan oil embargo against the United States would cause oil prices immediately to jump by $4 to $6 a barrel and increase gasoline prices at the pump by 11 to 15 cents a gallon.

A six-month loss of 2.2 million barrels a day of Venezuelan production — about what was lost during the strike by Venezuelan oil workers during the winter of 2002-03 — could cause a price spike of $11 a barrel and cut U.S. economic output by $23 billion, the report said, citing an Energy Department computer model analysis.

Venezuela, the world’s fifth-largest oil exporter, ships 1.5 million barrels a day of oil and petroleum products to the United States, accounting for 11 percent of U.S. imports. Most of Venezuela’s oil that is not domestically consumed is shipped to the United States. Venezuela’s government oil company owns or partly owns nine refineries in the United States.

Diplomatic relations between the two countries have been strained.

Venezuelan President Hugo Chavez occasionally has threatened to cut off oil shipments to the United States and pursue other customers including China.