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India Won’t Pay For Venezuelan Oil With ‘Petro’ Cryptocurrency

By Tsvetana Paraskova - May 28, 2018, 3:00 PM CDT

India doesn't plan to use Venezuela's 'petro' cryptocurrency to pay for crude oil imports from the Latin American nation of which it is a large regular customer, India's Foreign Minister Sushma Swaraj said on Monday.

India's central bank has issued an order saying that it doesn't allow trade in cryptocurrency, Swaraj said at a news conference, citing that order.

India's average oil imports from Venezuela have recently slumped to their lowest level since 2012.

Venezuela faces increasingly stricter U.S. financial sanctions and is trying to circumvent them by offering the customers of its declining oil production to pay in the El Petro cryptocurrency, touted by Nicolas Maduro as the first-ever sovereign digital currency backed by oil reserves.

India, on the other hand, faces an increasingly fatter crude oil import bill, as oil prices have rallied in the past few months and worsened Indian current accounts, with officials already worried that the high oil prices and the fuel prices at five-year-highs have started to affect economic growth.

India's Petroleum Minister Dharmendra Pradhan complained earlier this month to Saudi Arabia's Energy Minister Khalid al-Falih that rallying oil prices were hurting the Indian economy, and reiterated the need for "stable and moderate" prices. Related: Maduro Vows To Double Oil Production With Help From OPEC

Last month, Indian media reported that Venezuela had offered India a 30-percent discount on crude oil purchases, but only if India agrees to pay in El Petro. India has refused.

Venezuela, for its part, has also recently suggested that it was willing to accept rupees for the oil it sells to India-another way of bypassing the U.S. sanctions on dollar-based trade. The South American nation could then use its rupees to buy Indian food products and medicines, Indian media cited Venezuela's envoy Augusto Montiel as saying last week.

By Tsvetana Paraskova for Oilprice.com

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Tsvetana Paraskova

Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews.  More

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Comments

  • John Brown - 28th May 2018 at 3:13pm:
    El Petro is garbage. The only thing backing it is the falling oil production of a bankrupt Marxist Dictatorship that is on its way out no matter how many elections it rigs and/or steals. There is no chance Venezuela will recover until the nation rids itself of that corrupt, brutal, murderous, moron Maduro and the cronies and crooks around his and in his party that are looting the country while children starve. 15 plus years of socialism folks and the country with the worlds greatest oil reserves can't even keep it oil production stead let alone increase it. Take a hard long look at the worlds most recent experiment in socialism, and creating a socialist paradise. You have to give them credit. Except for the socialists destroyers holding power like Maduro who have stashed billions away outside of Venezuela they sure have smoothed out income inequality. Over 85% of the population is now officially poor, and not USA poor, but Latin America not enough food to feed the kids poor. Obama and the Democrat gave us 8 years of this. 8 years of killed jobs, no growth, incompetence, and corruption. The USA fortunately had stronger democratic institution and chose to reject socialist after 8 years, and Trump is now restoring jobs and our economy. Look at Venezuela folks. The best example of socialism in the world today.
  • John Scior - 28th May 2018 at 8:25pm:
    It seems India is smart staying away from this crypto-currency petro nonsense. I seriously doubt the present government of Venezuela will be around longer than 5 years for it to be nothing more than an footnote in the annals of History. I suspect India as well as China to take advantage of the sanctions against Iran by going through subsidiary companies to buy Iranian oil. Iranian oil output wont be impacted so much as their ability ( Iran's ) to obtain a prevailing world price for oil. I suspect they will discount it 15-25 percent in order to maintain their current output.
  • ermtko - 29th May 2018 at 2:29am:
    I do not know Petro. I know Bitcoin, Ripple and IOTA. I buy cryptocurrency at ccshop.
  • Luis Carpio - 18th Jun 2018 at 5:16pm:
    It is disingeneous to even suggest that the Venezuelan kleptocracy would use oild proceeds (regardless of the currency) to purchase "food products and medicines". It´s called a kleptocracy for a reason. People in Venezuela are starving and dying of diseases that democracy erradicated 30 years ago and not because of sanctions. Any money that flows our way quickly winds up in the offshore accounts of the regime´s cronies. This is documented.