• 4 minutes Mueller Report Brings Into Focus Obama's Attempted Coup Against Trump
  • 7 minutes Countries with the most oil and where they're selling it
  • 10 minutes Stack gas analyzers
  • 13 minutes What Would Happen If the World Ran Out of Crude Oil?
  • 1 hour End of Sanction Waivers
  • 2 hours Alliances: Iran And Pakistan To Form Joint Rapid Reaction Force At Border
  • 1 hour Balancing Act---Sanctions, Venezuela, Trade War and Demand
  • 2 hours Climate Change Protests
  • 2 hours Don't Climb Onto the $80+ Oil Price Greed Roller Coaster, Please.
  • 10 hours Mueller Report Brings Into Focus Trump's Attempts to Interfere in the Special Counsel Investigation
  • 9 hours Gas Flaring
  • 7 hours "Undeniable" Shale Slowdown?
  • 49 mins US Military Spends at least $81 Billion Protecting OPEC Persian Gulf Oil Shipping Lanes (16% DoD Budget)
  • 10 hours Trudeau Faces a New Foe as Conservatives Retake Power in Alberta
  • 14 hours How many drilling sites are left in the Permian?
  • 12 hours Oil at $40
  • 11 hours U.S. Refiners Planning Major Plant Overhauls In Second Quarter
  • 10 hours China To Promote Using Wind Energy To Power Heating
  • 11 hours Case against Trans Mountain Begins

Breaking News:

Guaido Takes Strides To Topple Maduro

Russia Vows To Defend Its Venezuelan Oil Assets

Rosneft

Russia, which stands by Nicolas Maduro in the ongoing Venezuelan political crisis, will use “all available legal mechanisms” to defend its interests in the Latin American country, in which Russian oil giant Rosneft has invested and extended loans to Venezuela’s state oil firm in exchange for crude oil deliveries.

Russia will defend its interests in Venezuela within the international law using “all mechanisms available to us,” Dmitry Peskov, spokesman for Russia’s President Vladimir Putin, told Russian media on Tuesday.

Russia has kept close ties with Maduro and has extended loans to Venezuela, including oil firm Rosneft lending money to Venezuela’s state-held firm PDVSA. Rosneft has extended US$6 billion of loans to PDVSA, which needs to be fully redeemed in crude oil supplies by the end of this year.

According to S&P Global Platts, as of November 2018, Venezuela had US$3.1 billion outstanding loan to repay to Rosneft. The Russian company also has five joint upstream projects with PDVSA in Venezuela.

However, the U.S. Treasury slapped another round of sweeping sanctions against PDVSA on Monday, in order to “help prevent further diverting of Venezuela’s assets by Maduro and preserve these assets for the people of Venezuela.”

The U.S. backed last week Juan Guaidó, the chairman of the National Assembly, as the legitimate president of Venezuela, after Guaidó declared himself interim president. 

“The path to sanctions relief for PdVSA is through the expeditious transfer of control to the Interim President or a subsequent, democratically elected government,” Secretary of the Treasury Steven T. Mnuchin said.

Related: The ‘Venezuela Benefit’ For Canadian Oil Producers Is Limited

The Kremlin considers the sanctions against PDVSA as “illegal”, a sign of “unfair competition” and an attempt to interfere with Venezuela’s internal affairs, Peskov said on Tuesday.

Russia is assessing the potential consequences of the sanctions on PDVSA for Moscow, Peskov added.

According to analysts briefed by Platts, whatever the outcome of Venezuela’s political impasse, Rosneft won’t be cut off from Venezuelan oil assets, as oil is pretty much the only hard-currency revenue the country can get. An analyst at a Western bank estimates Rosneft’s assets in Venezuela at up to US$2.5 billion, plus another US$2.5 billion in crude supplies for the loan to PDVSA.

“The worst-case scenario -- which is unlikely to materialize -- under which Rosneft loses all the money it invested in Venezuela, would be biting but not critical for the company, with quarterly free cash flow at over $4 billion,” the analyst told Platts.

By Tsvetana Paraskova for Oilprice.com

More Top Reads From Oilprice.com:



Join the discussion | Back to homepage

Leave a comment

Leave a comment

Oilprice - The No. 1 Source for Oil & Energy News