Venezuela boosted its crude oil exports nearly threefold in November to more than 500,000 barrels per day (bpd), including by hiding the true identity of tankers to avoid detection, Bloomberg reported on Tuesday, citing sources familiar with the matter and shipping and tanker-tracking data.
Almost the entire volume of oil exports from Venezuela was headed to China last month, while Venezuelan crude stockpiles fell substantially, according to the data reviewed by Bloomberg.
Data from internal documents of Venezuela’s state oil firm PDVSA, reviewed by Bloomberg, showed that the company stated the names of tankers that are no longer operational as vessels loading crude at a Venezuelan port in November. At least six tankers listed as loading Venezuelan crude last month were sent to scrapyards months ago, data compiled by Bloomberg shows. This suggests that the names and identification of the tankers may have been used by other vessels to ship Venezuelan crude.
PDVSA has been using ship-to-ship transfers for its exports to China, but reports emerged last week that Venezuela had resumed direct shipments of crude oil to China despite the escalating U.S. sanctions trying to stifle Nicolas Maduro’s regime.
China is the biggest buyer of Venezuelan crude as it is of Iranian crude, despite U.S. sanctions aimed at stifling the two countries’ oil revenues. As a result of the sanctions, Venezuela’s production and exports have suffered gravely, with estimates that the average crude oil exports falling to 359,000 bpd in October. The drop followed the expiry of a grace period the U.S. had given to commodity traders to wind down their oil-for-fuel swap business with Venezuela, which was allowed for humanitarian reasons.
Besides the ship-to-ship transfers, Venezuela and China are also employing another tactic used by Iranian tankers: switching the transponders off for most of their voyage and only switching them on again when they near their destination.
By Tsvetana Paraskova for Oilprice.com
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The bulk of Venezuelan crude oil exports go to China and the rest is sold around the world using ship-to-ship transfer, barter trade and also by employing another tactic used by Iranian tankers of switching the transponders off for most of their voyage and only switching them on again when they near their destination.
The sanctions have failed miserably to effect a regime change or to cripple both the Venezuela economy and the national oil industry.
It is estimated that it will cost an estimated $200 bn to rebuild Venezuela’s economy and its oil industry. But this is equivalent to only 1.5% of the value of Venezuela’s oil wealth of 303 billion barrels, the largest in the world. Even at a current low oil price of $45 a barrel, Venezuela’s oil wealth is estimated at $13.635 trillion so spending $200 bn to rebuild its economy isn’t a heavy price to pay.
This explains why the United States is so keen on a regime change, namely to get its hands on such a spectacular oil wealth. However, the Venezuelan people will never ever accept a puppet regime imposed on them by the United States.
Dr Mamdouh G Salameh
International Oil Economist
Visiting Professor of Energy Economics at ESCP Europe Business School, London