HOUSTON, Oct 3 (Reuters) - Shipments of Venezuelan diluted crude oil to Citgo Petroleum fell 57 percent in September, although parent company Petroleos de Venezuela said it would keep production levels unchanged during the month and would honor its delivery schedule.
Shipments of the grade of oil fell to 2.13 million barrels in September, compared with 4.99 million barrels the previous month, according to Reuters Trade Flows data, after state-run PDVSA put exports on hold to reset prices for the grade.
Although the Venezuelan company in August notified its partners and customers that scheduled deliveries of diluted crude oil (DCO) would continue, sales to the United States have declined sharply.
Citgo's Lake Charles, Louisiana, and Corpus Christi, Texas, refineries on the Gulf Coast only received four cargoes with 500,000 to 600,000 barrels of Venezuelan DCO in September, compared with seven cargoes in August.
U.S. oil firms Chevron Corp and Valero Energy , which had been regularly buying DCO from PDVSA this year, did not receive any in recent weeks.
Declining DCO shipments to the U.S. could hasten the decline of Venezuelan oil exports to the country.
In the first half of 2014, Venezuelan exports of crude and products to the United States fell 3.6 percent to 773,000 barrels per day (bpd), according to the U.S. Energy Information Administration. Ten years earlier, the country sent 1.55 million bpd.
DCO is a blend made of heavy crude oil from Venezuela's vast Orinoco Belt and heavy naphtha. Amid increasing naphtha prices that affected PDVSA and its partners, the company decided to review DCO's cost structure and stop spot sales.
Venezuela has also been storing more DCO in the Caribbean in recent weeks, mainly in Saint Eustatius, traders said. This terminal, owned by U.S.-based NuStar Energy, was partially leased by PDVSA this year to be used as a blending hub.
It is not clear when PDVSA will resume regular exports of DCO and if this decision will imply a price increase to all its clients. The state-run company was not immediately available to comment.
In September, Citgo's refineries in the Gulf Coast also received five 500,000 to 530,000-barrel cargoes of other Venezuelan heavy crudes, such as Merey and Corocoro.
And PDVSA's unit separately bought 750,000 barrels of Colombian Vasconia medium crude, 450,000 barrels of Canadian Terra Nova medium crude and 360,000 barrels of Ecuadorian Oriente crude for its Corpus Christi refinery in Texas.
Citgo's Gulf Coast refineries imported a total volume of 6.24 million barrels or some 208,000 bpd of different crudes in September - 156,000 bpd were Venezuelan crudes - according to Reuters Trade Flows data, made up of preliminary figures.
In the first half of 2014, the company imported 246,000 bpd of foreign crudes, including 161,000 bpd of Venezuelan grades. (Reporting by Marianna Parraga; Editing by Jessica Resnick-Ault and Chris Reese)