OR Russia has displaced the US as its main source of naphthas Venezuelana oil product needed to dilute its extremely heavy slow oil, as Washington’s commercial policies are pushing for the two countries that have been sanctified in deeper economic cooperation.
US Naphthas missions declined to zero from March to October, while flows from Russia amounted to more than 7 million barrels during the same period, according to Kpler. Supplies, equivalent to about 49,000 barrels a day in August and 69,000 a day in September, also represent the first recorded wave of Naphtha traditions from Moscow to Caracas in almost six years. Venezuela needs Naphtha, a product that can be used as a solvent, to dilute the crude oil -like oil and maintain its flow through pipelines for exports to countries such as China, one of its top buyers. More than half of the current 1.1 million barrels per day is drawn from the area of the Orinokos area, where the extremely heavy oil is located.
The South American country began looking for a new Naphthas supplier after US President Donald Trump Injected sanctions on the country’s oil sector Earlier this year, recalling the permission granted during the Biden Presidency to some energy companies to operate in the country, including Chevron.
Chevron’s revocation has put an end to the nearly 18 -month period during which the US was the almost exclusive supplier of South America’s country, an agreement that had offered a refinement companies a convenient market for lightweight surplus. Naftha from the US was delivered to Venezuela through a handful of suppliers, some of which were partners in oil businesses with state oil company Petroleos de venezuela SA. Venezuela then asked China to help her fill the gap without success. In previous years he had turned to Iran – which is also subject to strict sanctions – for the product. However, Russian Naphtha quickly emerged as a better quality and possibly a cheaper alternative to Iranian condensation.
“Washington’s policies are the link here,” said Rory Johnston, an oil market researcher and founder of Commodity Context. “Sanctions force these producers to turn to each other.”
While Venezuela has been under various US sanctions for two decades, Trump has targeted President Nicolas Maduro, whom he calls a narcotrome. The US government has offered $ 50m remuneration for information that will lead to its arrest and has made a series of attacks on vessels off the Venezuelan coast, which, according to the US, have been transporting drugs.
Under increasing pressure, the Maduro government announced this month that it has signed a cooperation agreement with Russia, which will promote joint efforts in the fields of energy and defense. Russian President Vladimir Putin had previously described his country’s relations with Caracas as “strategies”, though Russia has not issued its own public statement about cooperation.
For Maduro, the agreement with Russia “brings both economic benefits and political influence“, Said Fernando Ferreira, Rapidan Energy Group’s geopolitical director. For Russia, it is “a symbolic base in the backyard of the US, which enhances Maduro’s confidence and annoys Washington.”
While Russia and Venezuela had entered into various oil and gas agreements in the past, the new supply line allows Moscow to unload the surplus of naphtha after loss of access to European markets due to international sanctions on the invasion of Ukraine.
The flow of naphtha from Moscow to Caracas continued, although it is widely believed that Chevron has regained the ability to send the solvent as part of a so -called cargo exchange, where petroleum products replace cash as a tax on Venezuelan crude oil. The license is not public, so it is not clear if this is true. Russia’s ongoing war in Ukraine could complicate things. Moscow’s refining network has been hit by Ukrainian drones attacks, asking questions about the availability of products. Ust-Luga, an export terminal to the Baltic Sea that is responsible for almost 7% of Russian naphthas exports to Venezuela, according to Vortexa data, suffered extensive damage from attacks in late August, of the US Gulf on a monthly basis, according to Jorge Molinero, who watches the flows of Naphtha at Sparta Commodities.
For the US, sellers have identified alternative markets in Asia and Europe that have overwhelmed the loss of revenue from Venezuela, according to analysts.