While bondholders of PDVSA debt are waiting to receive the latest bond payment from Venezuela's cash-strapped state oil firm, the company is six months behind in payments to the largest Indian oil producer ONGC, two sources close to the transactions have told Reuters.
Since April, PDVSA has failed to pay dividends to ONGC for the Indian company's investment in an energy project in Venezuela, for a total backlog of some US$540 million, according to the sources.
ONGC's overseas investment arm ONGC Videsh confirmed to Reuters that the Venezuelan firm is behind with payments, but declined to specify details.
According to Reuters' sources, PDVSA used Russian state-held bank Gazprombank to clear in January a US$19.75-million payment to ONGC. In addition, India's refining giant and one of PDVSA's biggest oil customers, Reliance Industries, paid US$68.66 million to ONGC on behalf of PDVSA in April, the sources added.
Venezuela is now using mostly credit from Russia and China and is repaying them in oil.
PDVSA has been delaying payments to contractors and service providers to save up the little cash it has for making the bond payments.
Venezuela's President Nicolas Maduro is looking to restructure the country's US$89 billion worth of debt to be able to continue servicing it.
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On Tuesday, Fitch Ratings downgraded PDVSA's long-term foreign currency Issuer Default Rating (IDR) to C from CC, to reflect the recent announcement by both the company and the government that they intend to pursue a renegotiation of the company's sovereign external debt obligations. The downgrade also comes as a result of the previously missed payments on international bonds that are currently within their 30-day grace periods.
"In Fitch's view, this makes a default event highly probable," the rating agency said.
According to Fitch, Venezuela's external reserves were US$10.1 billion as of November 2017, of which a significant portion was in gold. PDVSA's cash on hand as of December 31, 2016, was some US$8.3 billion.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews. More