Page 5 - LatAmOil Week 39 2022
P. 5

LatAmOil                                     COMMENTARY                                            LatAmOil


                         That is, a number of obscure companies headed   industry that is their largest source of revenue.
                         by, established by or linked to Russian nation-  Now that Russia has joined the ranks of
                         als are reported to have played a role in mov-  countries sanctioned by the US, however, it is
                         ing crude from Venezuela to Asia by tanker in   not showing the same sort of generosity. On the
                         ways that are designed to conceal or obscure the   one hand, Russia is not maintaining its upstream
                         origin of their cargos. Some of these companies   presence in Venezuela. Rather, Argus Media has
                         have known connections to Rosneft, while oth-  reported recently that Roszarubezhneft is qui-
                         ers do not.                          etly withdrawing from its joint ventures with
                           In any event, these Russian entities continued   PdVSA.
                         to provide PdVSA with an invaluable service   On the other hand, Russian oil exporters are
                         through 2020 and 2021. That is, they continued   reportedly stepping up the competition for “dark
                         to deliver Venezuelan oil to willing customers,   fleet” tankers – that is, crude and fuel carriers
                         most of them in Asia, in a manner that incor-  operated by obscure companies that are willing
                         porated just enough plausible deniability that   to move liquid cargoes from sanctioned coun-
                         the US government did not make too much of a   tries – in order to ensure that their production   Russian
                         fuss about sanctions. After all, Washington was,   reaches the market. This competition is report-
                         by then, quite distracted with matters related to   edly having a direct and negative impact on the   competition
                         the coronavirus (COVID-19) pandemic, the   volume of Venezuelan (and Iranian) oil availa-  for “dark fleet”
                         economic fallout resulting from public health   ble to buyers in Asian markets such as India and
                         restrictions and a contentious presidential   China.                      tankers is having
                         election.
                           Moreover, the amount of Venezuelan oil hit-  Tighter Iran-Venezuela ties?  a direct and
                         ting world markets was also down in 2020 and   For Iran, the result of this development has
                         for most of 2021 too. This was partly because US   been an increased reliance on vessels owned by   negative impact
                         sanctions were doing a decent job of preventing   National Iranian Tanker Co. (NITC) to export   on Venezuelan
                         PdVSA from accessing the parts and equipment   the country’s crude production. But for Ven-
                         it needed to keep its production infrastructure   ezuela, the outcome could be a move toward   (and Iranian)
                         in good repair and partly because the pandemic   greater co-operation with Iran – especially if
                         dragged global energy downward in 2020.  the latter is willing to offer even more of the   crude oil flows
                                                              fuel, blendstock, parts, equipment and techni-
                         Late 2021: Iran steps in             cal assistance it agreed to provide in November
                         But conditions have changed since late 2021.  2021.
                           In practical terms, Venezuelan oil output and   Meanwhile, Iranian deliveries to Venezuela
                         export volumes started going up in late 2021   certainly don’t seem to be slowing down. Reu-
                         thanks to a series of agreements that Caracas   ters reported earlier this week, citing documents
                         signed with Tehran. Under those agreements,   from PdVSA, that two Iranian tankers were due
                         Iran has been providing PdVSA with some   to dock at the Jose terminal on Venezuela’s coast
                         of the things it needs the most – lightweight   within the next few days to deliver 1.22mn bar-
                         blendstocks such as gas condensate that can be   rels of crude oil and 2mn barrels of gas conden-
                         combined with Venezuela’s extra-heavy crude to   sate. One of the tankers has been identified as the
                         make a lighter synthetic oil that is easier to sell   Huge, a very large crude carrier (VLCC) owned
                         on international markets, parts and equipment   by NITC, while the other ship has the name of
                         that can be used to repair decrepit refineries   a vessel that is reported to have been scrapped,
                         and production facilities, technical assistance   Reuters said, citing the PdVSA documents.
                         from Iranian experts and periodic deliveries of   Both of the cargoes were supplied by NaftI-
                         Iranian petroleum products for distribution on   ran Intertrade Co. (NICO), a state-owned Ira-
                         Venezuela’s fuel-starved domestic market.  nian firm.
                           Iran’s generosity in this realm is not difficult   PdVSA materials show that Iran took deliv-
                         to understand. Both Tehran and Caracas are   ery of around 4.8mn barrels of Iranian crude
                         targets of US sanctions, and officials in both   and gas condensate in July and August of this
                         capitals have spoken frequently of the need for   year, Reuters noted. The two shipments men-
                         and benefits of co-operation in the face of Wash-  tioned above will bring the total up to 8.02mn
                         ington’s efforts to discourage investment in the   tonnes. ™

















                                                                                                           (File photo)



       Week 39   28•September•2022              www. NEWSBASE .com                                              P5
   1   2   3   4   5   6   7   8   9   10