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U.S. Sanctions Second Cuban Firm Over Venezuelan Oil Deals

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Published Nov 26, 2019 8:48 PM by The Maritime Executive

The U.S. Treasury has sanctioned Cuban company Corporacion Panamericana S.A. for assisting blacklisted Cuban commodity firm Cubametales to arrange international petroleum trading contracts. 

The new listing is twice removed from the original:  Cubametales was first placed on Treasury's sanctions list in July for conducting business with Venezuelan state petroleum company PDVSA, which was sanctioned in January because its proceeds fund the government of Venezuelan President Nicolas Maduro. Washington does not recognize Maduro as the legitimate ruler of Venezuela, and instead favors Juan Guaido, the head of the political opposition and the self-declared interim president of Venezuela.

Corporacion Panamericana has not been accused of doing business with PDVSA, but of facilitating unrelated petroleum transactions for Cubametales, which previously did business with PDVSA. According to Treasury, Corporacion Panamericana served as a stand-in: After a North African company refused to do an oil transaction with Cubametales due to American sanctions, Cubametales arranged for Corporacion Panamericana to take over commercial relations with the company and complete the deal.

In addition, Corporacion Panamericana onboarded employees from Cubametales following Treasury's designation of Cubametales. After the designation, a  Cubametales official who held a position with the same duties at Corporacion Panamericana negotiated a deal with a European company for the delivery of gasoline to Cuba. 

“Cuba has played a direct role in preventing the return of democracy to Venezuela,” said Treasury Deputy Secretary Justin G. Muzinich. “Treasury continues to pursue sanctions evaders to deny resources to the illegitimate Venezuelan regime.”

Driven by political unrest, economic collapse, hyperinflation and food shortages, about four million Venezuelans have fled their country since 2016, according to the United Nations. Maduro has so far resisted popular calls for his departure, and despite harsh sanctions, he has continued to finance government operations with foreign exports of oil and gold.