Russia may take control of Venezuelan oil

Caracas is heavily in debt to Moscow, and with U.S. sanctions, no ability to pay it back.
So Caracas is looking to cut a deal.

The Venezuelan government is readying to hand over control over state oil company PDVSA to Russia’s Rosneft, a local newspaper has reported, citing sources from the industry.

Russian TASS reports, quoting El Nacional, that the radical move is being discussed as a way of erasing Caracas’ debt to Moscow. The debt is sizeable: at the end of June this year, money owed to Rosneft alone stood at $1.1 billion. That’s down from $1.8 billion at end-March.

Two years ago, Caracas and Moscow sealed a deal for the restructuring of another $3.15 billion debt to Russia over 10 years with minimum payments over the first six years. Since 2006, Russian loans to Venezuela have reached more than $17 billion in total.

According to the El Nacional report, Moscow had reacted positively to the suggestion, and several commissions had been set up and sent to Venezuela to evaluate the situation at PDVSA.

It's questionable whether Washington won't prevent this from happening. After all, allowing all that oil to fall under the sway of Moscow would essentially be a defeat.
Interestingly, India is also getting involved with Venezuelan oil.

India’s Reliance is set to resume oil imports from sanctioned Venezuela, according to a Reliance representative that spoke to Reuters on Wednesday.

India had stopped its imports of Venezuelan oil months ago after the United States sanctioned Venezuela. Reliance feels secure in its decision to resume the imports, because it will be taking the crude oil in exchange for supplying Venezuela with fuels including diesel, a scenario that is allowed under the sanctions.
...
Venezuela’s list of crude oil buyers have shrunk in the wake of the sanctions, with Cuba, Russia, and China one of its last remaining customers, but few of those customers pay in cash for all the Venezuelan oil they receive.

Like Reliance’s plan to swap its oil products for crude oil, Cuba swaps goods and services for its oil, while China and Russia both accept crude oil from Venezuela in exchange for loans they already extended to the troubled Latin America country. Of those, Russia’s Rosneft is Venezuela’s largest importer, handling 66% of all of Venezuela’s imports.

Share
up
17 users have voted.

Comments

lotlizard's picture

up
4 users have voted.
Lookout's picture

already in Columbia and soon in Brazil. Oh boy, we can have a war close to home and not have to travel all the way to the middle east.

up
7 users have voted.

“Until justice rolls down like water and righteousness like a mighty stream.”

CB's picture

is well over $100 billion of which about $60 billion is now in default. You can buy some of these bonds for 24 cents on the dollar (rose to 30 cents when Juan Guaidó was inserted). These speculators hoped to cash in if they can overthrow Maduro and pillage the country's natural resources. If the US government coup had worked, speculators would have seen returns of 400% on billions of dollars. This is the kind of shit Soros engineered in Eastern Europe (perfect examples were Russia in the 90's and Ukraine in 2014).

The Venezuelan debt to Russia of $3.15 billion factored over 10 years is peanuts. Putin wrote off Cuba's $32 billion and gave them an additional loan.

The Rosneft loan of $1.1 billion can also be handled with ease - the company had $16.3 billion gross/$7.2 billion net earnings last year. They could readily write this off as good will in anticipation of earnings they can make once they get involved in the 1 trillion barrels of oil locked up in the Orinoco Belt. This is a very small price for the potential gains. They also get a supply of oil in payment. This oil will most likely get bought by American refineries in the US (Russia sold the US 15 million bbls last year) in order to feed Gulf refineries which are starved of the heavy oil they require (they can't move the Canadian tar sands quick enough due to pipeline bottle neck).

Complete control of food and energy is what it is all about - the world's natural resources DO NOT belong to the people - they belong to the capitalistic corporations and these corporations will kill untold millions of people with little to no remorse to ensure it remains this way.

The more things change, the more they stay the same....

Russia and China are US corporate enemies #1 and #2. They don't practice rapacious zero sum trade deals with third world countries.

up
7 users have voted.