Page 4 - DMEA Week 39 2022

DMEA COMMENTARY DMEA

(Photo: PdVSA)
Ongoing shifts in Venezuela’s

relationships with Russia, Iran

Russia’s entry into the ranks of countries sanctioned by the US appears to be damaging ties

with Venezuela – and giving Venezuela reasons to expand its existing co-operation with Iran

WHEN the US government began imposing Asia and disguising its origins. In March of that
sanctions on Venezuela’s oil industry in 2019, year, it handed all of its Venezuelan assets over
WHAT: Moscow made a show of standing by Caracas. to Roszarubezhneft, an entity fully owned by
A state-owned Russian It made it clear that it recognised Nicolas the Russian government, and formally left the
company is withdrawing Maduro’s re-election in late 2018 as legitimate, country.
from Venezuela, while even as officials in Washington cited allega-
Russian oil exporters are tions of fraud as the reason for the decision to Ongoing links with Russia
competing for tankers introduce new restrictions on trade. Russia These manoeuvres do not seem to have done
that once carried Vene- maintained trade relations with Venezuela, and much good on the upstream front. The US sanc-
zuelan crude. at least initially, Russia’s state-owned oil major tions regime has deprived Roszarubezhneft of
Rosneft maintained its stakes in joint ventures access to the financing and equipment it needs
WHY: with Venezuela’s national oil company (NOC) to keep its joint ventures going, so it has not
Russia and Venezuela PdVSA. been able to produce much oil since it replaced
have a track record of Rosneft also served as Venezuela’s main link Rosneft in Venezuela. (The nature and extent of
co-operation in the oil
sector. to world oil markets in 2019, as it handled the that replacement are debatable, by the way, since
majority of the PdVSA’s crude exports via vari- both are state-owned entities that answer to the
WHAT NEXT: ous subsidiaries in that year. Kremlin.)
Venezuela may seek to However, it backed down in early 2020 Further down the value chain, the picture is
step up its existing ties after the US government sanctioned two lit- not clear. Russian interests have definitely been
to Iran. tle-known Rosneft affiliates that were reported able to stay involved in the business of moving
to be covertly shipping Venezuelan crude to Venezuelan oil to market.

P4 www. NEWSBASE .com Week 39 29•September•2022