Page 6 - FSUOGM Week 18 2021

FSUOGM COMMENTARY FSUOGM

The apparent conflict between Vitrenko and the top management replacement,” an analyst
Kobolev ended in the former’s dismissal from at the Kyiv-based Concorde Capital brokerage
Naftogaz in July 2020. Then in December of last said in a research note. “However, the way the
year, Vitrenko was appointed as acting energy replacement was made indeed raises questions
minister. regarding the corporate governance reform in
In February, he recommended that the Cabi- Ukraine’s state-owned enterprises and it clearly
net replace Naftogaz’s supervisory and manage- indicates that the ‘reform’ has not changed the
ment boards. interaction between government and managers/
“Vitrenko could be at least as efficient at boards of state-owned companies. This is not
the position of Naftogaz CEO as Kobolev was, news, but just another display of poor institu-
so there is no risk to Naftogaz operations with tional governance in Ukraine.” ™

Is Russian interest in

Venezuelan oil reviving?

Concerns about US sanctions appear to have convinced state-run Rosneft and its main

shareholder, the Russian government, to maintain a low profile in Venezuela’s oil sector

RUSSIAN investment in Venezuelan oil assets future?
has – technically, at least – ramped down over
WHAT: the last year. Russian-Venezuelan co-operation
Russian and Venezuelan The decline began in March 2020, when state- A little more than a month ago, there were signs
officials recently dis- owned Rosneft, which had long been one of the that Russia might start exploring new opportu-
cussed expanding energy most active partners of Venezuela’s national oil nities in Venezuela.
co-operation. company (NOC) PdVSA, announced plans to Those signs emerged during Russian Deputy
discontinue its operations in the South Ameri- Prime Minister Yuri Borisov’s visit to Caracas
WHY: can country. In May 2020, just two months later, on March 31. During that visit, Borisov and the
Rosneft does not appear Rosneft said that it had completed the process delegation he was leading signed 12 agreements
to have compelling rea- of withdrawal. with the Venezuelan government. Those doc-
sons to seek re-entry into There has been some speculation that Ros- uments provided for the two sides to expand
its Venezuelan assets.
neft did not exactly quit Venezuela. Instead, co-operation on many fronts, including energy.
WHAT NEXT: some observers alleged last year that the Rus- It is not clear whether Moscow and Caracas
The status quo is likely to sian major had shuffled its Venezuelan assets are looking at any specific initiatives. Rostec, a
stand, absent a change in around, moving them first to a state-controlled state-owned concern involved in technology
US sanctions policy or a shell company and then to a little-known private and arms sales, did agree to work with PdVSA
shift in Russia’s strategic security firm with which it already had ties in on beefing up security measures at Venezuelan
priorities.. order to evade the consequences of US sanctions oil facilities, including production sites, process-
on Venezuela. And certainly, there have been ing units and pipelines.
reports that Russian companies and traders are Rosneft, however, did not take compa-
playing a prominent role in helping Caracas rable measures at the same time – at least not
send part of its oil production to the world mar- openly. Venezuelan authorities would proba-
ket, despite the US sanctions regime. bly be receptive to overtures from the Russian
Even so, Rosneft is no longer playing as much major, especially in light of their recent attempts
of an active role in Venezuela as it did before. to draw new oil investment into the country
The prospect of falling foul of US sanctions does under a new “anti-blockade” law that promises
appear to have deterred the company – and its confidentiality to companies that fear the con-
parent organisation, the Russian government sequences of teaming up with PdVSA. It is not
– from co-operating openly with Venezuela. certain, though, whether any such overtures
(Indeed, it is worth noting that the Russian giant have been made.
announced plans to ramp down operations in
that country after US authorities expanded trade Barriers to Rosneft’s return
restrictions in February and March of 2020 to And there may not be any, at least not in the
cover two of its subsidiaries, Rosneft Trading near term. At this time, Rosneft does not have
and TNK trading.) any obvious economic incentives for returning
How likely is that to change in the near to Venezuela.

P6 www. NEWSBASE .com Week 18 05•May•2021