U.S. Sanctions Rosneft Trading for Helping Venezuela Ship Crude Oil
Following pressure from Venezuela's political opposition, the United States has blacklisted the Russian oil trading company that has helped Venezuelan President Nicolas Maduro circumvent sanctions and continue exporting oil to the world market.
On Tuesday, the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) designated Rosneft Trading S.A., the Swiss-incorporated oil brokerage division of Russian oil company Rosneft, for "operating in the oil sector of the Venezuelan economy." OFAC also designated the head of Rosneft Trading, Didier Casimiro, for the same sanctions-busting activity. Casimiro has allegedly held meetings with Petroleos de Venezuela (PDVSA) officials to discuss joint projects and opportunities.
All property and assets of both Rosneft Trading and Casimiro that are either in the United States or in the control of U.S. persons (including American banks, financial institutions and other entities) are now blocked. Companies that have business dealings with Rosneft Trading will have a limited period time to wind down their connections under a temporary OFAC general license.
“Rosneft Trading S.A. and its president brokered the sale and transport of Venezuelan crude oil,” said Treasury Secretary Steven Mnuchin in a statement. “The United States is determined to prevent the looting of Venezuela’s oil assets by the corrupt Maduro regime.”
Rosneft Trading currently handles an estimated 70 percent of Venezuela's crude oil exports, and Treasury disclosed several of the specific transactions that formed the basis for the sanctions designation:
- In January 2020, Rosneft Trading S.A. facilitated a shipment of two million barrels from Venezuela to West Africa for PDVSA;
- PDVSA planned oil shipments with Rosneft Trading involving 55 million barrels of crude oil liftings from September to December 2019;
- In September 2019, PdVSA supplied a shipment of one million barrels to Rosneft Trading, which was loaded in Venezuela and destined for Asia;
- In August 2019, Rosneft Trading S.A. negotiated a shipment of two million barrels with PDVSA and found a vessel willing to transport the cargo.
"The United States has made it clear that we will consider lifting sanctions for those who take concrete, meaningful, and verifiable actions to support democratic order in Venezuela," Treasury noted, pointing to its previous actions in favor of designees who changed their behavior.
Rosneft Oil Company and Rosneft Trading had already been designated pursuant to American sanctions on the Russian energy sector, which were enacted to penalize Russia for its 2014 annexation of Crimea, and were already subject to a limited set of restrictions.
In a statement, the Kremlin pushed back on U.S. sanctions measures and suggested that they would not have any effect on Russian foreign policy. Russia categorically does not accept unilateral restrictive measures by which the United States, striving for global hegemony, is trying to subjugate the whole world to its will," the Russian foreign ministry wrote. "They did not and will not be able to influence the Russian line in international affairs, including interaction with the legitimate authorities of Venezuela, Syria, Iran or any other country."