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Squeezed by sanctions, Venezuela sells oil to tiny Turkish firm

July 15/2019

MOSCOW (MRC) -- With US sanctions blocking Venezuela from selling oil to the United States, state-owned energy firm PDVSA has turned to several little-known buyers that include a tiny Turkish company with no refineries but ties to President Nicolas Maduro’s government, reported Reuters with reference to internal documents and a PDVSA source.

Until recently, some of the world’s largest petroleum and refining firms, including US companies Chevron and Valero Energy, lined up to take Venezuelan oil cargoes and PDVSA had a rigorous vetting process to ensure potential buyers had the capacity to pay.

But US sanctions imposed in January in an effort to oust Maduro have driven away many of those customers. PDVSA’s exports have slumped by more than a fifth since sanctions were imposed, according to company records and Refinitiv Eikon data. Its biggest buyers today are Chinese and Indian companies.

Three sources with knowledge of the matter told Reuters that directors at a March 14 meeting of PDVSA’s board temporarily waived some requirements for new customers or suppliers, including that of having at least two years’ experience in the oil industry.

Neither PDVSA nor Venezuela’s oil ministry responded to requests for comment for this story.

In the wake of the changes, a Turkish company called Grupo Iveex Insaat started buying Venezuelan oil in April, according to documents related to PDVSA loading plans and internal reports on exports and imports for the first half of the year reviewed by Reuters.

Istanbul Chamber of Commerce records show that Iveex Insaat was formed less than a year ago with capital of just 10,000 lira (USD1,775) and listed “residential construction” as its main activity.

It was one of only five firms that loaded tankers to take Venezuela’s upgraded crude - among its most valuable oil - from April through June, the documents showed. Iveex loaded four cargoes of Venezuelan crude and products in April - equivalent to just under 8 percent of Venezuela’s oil exports - and nothing in May or June, according to PDVSA documents.

Turkish corporate records show Iveex Insaat is owned by Miguel Silva, a Venezuelan businessman who heads the Caracas-based Venezuelan Exporters’ Chamber and also served as a housing ministry commissioner in Maduro’s administration.

Reuters was unable to determine the terms under which Iveex Insaat is receiving Venezuelan oil and was unable to confirm who would ultimately buy and refine the crude, as the company has no refineries.

Neither Iveex Insaat nor Silva responded to requests for comment.

The PDVSA source, a shipping broker and a maritime inspector - all of whom declined to be named - told Reuters that Iveex had agreed to deliver refined products to Venezuela in exchange for receiving crude. With its refinery network crippled by maintenance issues, the OPEC nation has struggled with severe fuel shortages in recent months.

The two other companies that only began chartering tankers to take PDVSA’s oil after sanctions hit are Panama-registered Melaj Offshore Corp and Sahara Energy, a unit of Nigeria-based Sahara Group. The two loaded PDVSA oil cargoes shortly after the sanctions were announced, internal company documents show.

Sahara Energy did not respond to emails and calls to request comment. Reuters was unable to find contact details for Melaj.
Author:Margaret Volkova
Tags:crude and gaz condensate, Venezuela, China, USA, Turkey.
Category:General News
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