Venezuela
is putting pressure on fuel suppliers to deliver cargoes to PDVSA,
despite US sanctions again the state-owned oil company.
European buyers have put scheduled export shipments on hold, according
to various reports on the latest situation, received from Reuters,
Platts and other sources.
The country’s fuel stocks were further depleted this week as domestic
refineries were not producing much and PDVSA faced complications linked
to new US sanctions aimed at ousting President Nicolas Maduro.
On Thursday, intelligence police and National Guard officials
threatened to board a tanker docked at PDVSA’s Punta Cardon terminal to
pressure the vessel’s crew to discharge diesel that had not been paid
for by PDVSA and was sold by the company’s US refinery Citgo, according
to four sources, talking with Reuters.
Venezuela was thought to have less than two weeks left of gasoline and
diesel supply, according to some estimates, with lines at gas stations
starting to form around the country.
In another report, it was claimed that Venezuela’s oil storage volumes
have started to build up at the country’s ports and terminals, as PDVSA
could not export crude at its usual level, due to the US sanctions
imposed earlier this week, according to sources and shipping data.
Sanctions announced on Monday by the Trump administration were aimed at
driving Maduro out of power. These have barred PDVSA’s US customers
from transferring payments to the oil company.
As of Wednesday, Venezuela had 25 tankers with nearly 18 mill barrels
of crude — representing about two weeks of the country’s production —
either waiting to load or expecting authorisation to set sail. Most of
those were anchored near the port of Jose, the country’s largest,
according to Refinitiv Eikon data, analysed by the newswires.
PDVSA has responded to the sanctions by stopping tankers leaving its
ports with oil bound for the US, if the cargoes have not been not
prepaid.
In addition, PDVSA’s inability to pay for crucial imports means fuel
imports are delayed, adding to the glut of tankers off Venezuela’s
coast.
“We are facing problems to continue storing Merey crude,” a PDVSA
source said, referring to the most common crude grade it exports,
Reuters reported.
Most of the crude was bound for US customers — including PDVSA’s US
refining unit Citgo Petroleum, Chevron Corp, Valero Energy and PBF
Energy. Other large vessels loaded with Venezuelan oil and fuel were
waiting to depart for Singapore, India and China, local reports said.
PDVSA exported 1.25 mill barrels per day of crude last year, including
500,000 barrels per day to the US. The company boosted sales in early
January in anticipation of sanctions, according to Refinitiv Eikon’s
data.
On Wednesday, Wills Rangel, a PDVSA board member, told Reuters the
state-owned company did not plan to cancel supply contracts with US
clients. Meanwhile, PDVSA President Manuel Quevedo said on Tuesday said a
declaration of force majeure that would free PDVSA from paying
penalties for undelivered cargoes was under consideration.
The company is looking to India to import more Venezuelan crude and is
also considering imports of light crude if necessary to boost domestic
production of gasoline.
PDVSA is facing problems unloading fuel imports for domestic use
because sanctions are making it difficult to complete payments for
deliveries, according to Rangel, who also leads the firm’s labour union.
Sanctions require PDVSA’s US-based customers, including its refining
arm Citgo Petroleum, to deposit import proceeds in special accounts out
of Maduro’s reach.
They also limit US dollar transactions with PDVSA, but did not specify if US fuel can still be exported to Venezuela.
PDVSA will insist the fuel cargoes are discharged and try to find a way to pay for them, Rangel said.
Venezuela’s main fuel suppliers are Citgo and India’s Reliance
Industries, which typically ship naphtha, alkylate for gasoline, diesel
and components from the US, according to internal PDVSA trade documents,
seen by Reuters.
As of Wednesday, over 15 tankers were anchored waiting to discharge
some 5.5 mill barrels of diesel, gasoline, vacuum gasoil, liquefied
petroleum gas and naphtha — enough for an estimated 13 days of
consumption.
Reports from Greece claimed that at least two Greek-owned tankers,
belonging to Horizon Tankers and Hellenic Tankers, have been seized by
the Venezuelan authorities and were only released after their cargoes
were confiscated.
The tankers were carrying refined fuel for the Venezuelan market.
According to shipbroking sources and reports in TradeWinds, the vessels
had stopped off the Venezuelan coast but within the country’s
territorial waters and said that they would not deliver their cargoes
until they were paid for previous deliveries.
This practice has recently become quite common as there have been major
delays in payments by PDVSA, which faces obligations of $34.6 bill.
However, the country’s authorities cited an emergency to sidestep
English law – which the charterparties were based on – and enforce
Venezuelan law enabling the country to confiscate the the two Greek
tankers’ cargoes, as well as several others, it was reported.
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