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Report: Venezuela Swaps Jet Fuel for Iranian Gasoline

fortune
The Iranian tanker Fortune arrives in Venezuela, 2020 (Armed Forces of Venezuela)

Published Feb 24, 2021 10:46 PM by Ankur Kundu

Venezuela has been shipping jet fuel to Iran in trade for vital gasoline imports for the South American nation, according to an exclusive report by Reuters - part of a swap deal undertaken by the two sanctions-hit nations.

As the United States tightened up its sanctions on the two regimes and their respective energy industries, state-run Petroleos de Venezuela (PDVSA) had to find an alternative supply for gasoline, as worsening refinery outages made it difficult to process the country’s abundant crude oil. Most shipping companies have rejected carrying Venezuelan oil or going to the country with fuel for fear of being sanctioned by Washington. In search of a supplier, PDVSA partnered with the National Iranian Oil Company (NIOC), which is on a U.S. blacklist already as part of Washington's sanctions on the Iranian nuclear program.   

Iran has sent a small armada of state-operated tankers carrying vital gasoline for the South American nation, along with equipment and spare parts to help Venezuela in restarting its refineries. However, the reports on what Iran is getting from Venezuela in return have been limited. Reuters reports that both NIOC and PDVSA had agreed last year to a full swap of Venezuelan jet fuel in order to pay for the Iranian gasoline.

Coronavirus related restrictions have resulted in a shutdown in most domestic air travel, leaving Venezuela with huge reserves of jet fuel. On delivering the gasoline, Iranian tankers head back out with jet fuel, resulting in a 'perfect round trip'. The source allegedly told Reuters, “each cargo is priced and compensated later [and] if there are differences in value (between swap shipments), they are paid through future cargoes."

Both Iran and Venezuela have celebrated the Iranian fuel shipments as a way of resisting pressure from their common adversary.