As world leaders desperately seek alternatives to Russian oil, Venezuelan Petroleum Minister Tareck El Aissami on Tuesday said that Caracas is willing to export crude oil to “any government of the world or any country, or any company of any country,” noting that only United States (US) sanctions stand in the way.
Aissami told Reuters that state-owned oil company PDVSA is “prepared and ready” to resume operations with California-based oil giant Chevron “but it no longer depends on us.” He noted that “the ball is in the US government’s court,” pointing to the continued imposition of partial sanctions.
Over the past few years, Venezuela has found various ways to circumvent US sanctions.
Freeing up #Venezuela's and #Iran's oil to "contain" #Russia is one of those ostensibly cynical "realist" ideas that is, on inspection, more naïve than anything from an idealist. Strengthening any one of these states, strengthens them all - and #China. https://t.co/WXoBy4qy4T
— Kyle Orton (@KyleWOrton) August 31, 2022
For instance, last week a Reuters investigation revealed that a Chinese state-owned defence firm—China Aerospace Science and Industry Corp (CASIC)—has imported 25 million barrels of Venezuelan crude in three PetroChina tankers since November 2020 “under a special green channel” by intentionally rebranding it to be of Malaysian origin in order to evade sanctions.
Since then, an estimated 13 shipments amounting to $1.5 billion containing Venezuela’s flagship-grade Merey crude have reached Beijing. The move has allowed Venezuela to offset over $50 billion in debt owed to China and enabled it to ship nearly 420,000 barrels per day between January and July this year.
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— Javier Blas (@JavierBlas) August 31, 2022
Chinese imports of Malaysian oil have surged above Malaysian production. The reality? Smuggled oil from Russia, Iran and Venezuela.
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Reuters’ findings were further supported by a Wall Street Journal report this week that found that oil sourced from Iran, Venezuela, and now Russia is stored at the United Arab Emirates’ Fujairah port and intentionally disguised to bypass sanctions.
With the Ukraine war continuing for a sixth consecutive month, countries dependent on oil imports have been forced to turn to oil-rich nations like Venezuela to fulfil their energy needs. In fact, in a significant turnaround in May, US President Joe Biden even lifted some Trump-era energy sanctions imposed on Venezuela to allow a partial resumption of operations of the only remaining US oil firm in the country—Chevron.
Citing anonymous US officials, the New York Times claimed the US saw Venezuelan oil as a potential substitute for Russian imports were it to slap sanctions on Moscow as a result of Putin’s invasion of Ukraine.
— Fuad Alakbarov (@DrAlakbarov) March 6, 2022
However, Venezuela’s goal of kickstarting its faltering energy industry has been dealt another blow by its own decision to suspend oil shipments to Europe under an ‘oil-for-debt’ deal, with Caracas now demanding refined Italian and Spanish fuel in exchange for crude oil. Venezuela is seeking refined fuel, or diluents, to facilitate the recovery of its ailing domestic production units, with a 28% decline in oil production since December 2021, derailing President Nicolás Maduro’s plan to raise production to 2 million barrels per day before the end of 2022. The European Union, however, has refused to offer any such concessions.
Nevertheless, earlier this month, Maduro insisted that “come rain or shine,” the country will increase oil production to 3 million barrels per day by 2023.