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  • By The Financial District

Chinese Defense Firm Lifting Venezuelan Oil For Debt Offset

China has entrusted a defense-focused state firm to ship millions of barrels of Venezuelan oil despite US sanctions, part of a deal to offset Caracas' billions of dollars of debt to Beijing, according to three sources and tanker tracking data, Chen Aizhu and Marianna Parraga reported for Reuters.


Photo Insert: China National Petroleum Corp (CNPC) stopped carrying Venezuelan oil in August 2019 after Washington tightened sanctions on the South American exporter.



China National Petroleum Corp (CNPC) stopped carrying Venezuelan oil in August 2019 after Washington tightened sanctions on the South American exporter. But it continued to find its way to China via traders who rebranded the fuel as Malaysian, Reuters has reported.


Since November 2020, China Aerospace Science and Industry Corp (CASIC) has been carrying Venezuelan crude on three tankers it acquired that year from PetroChina, CNPC's listed vehicle, the sources said. The oil is stored on a tank farm it also took over from PetroChina, the sources said.



The three CASIC tankers load in Venezuela with their transponders active, allowing third-party tracking, Eikon data showed.


The firm has far taken 13 cargoes carrying a total of about 25 million barrels of oil, including two vessels due to arrive in China in September, according to the loading schedules of Venezuelan state oil firm PDVSA, and tanker tracking data from Refinitiv and Vortexa Analytics.


All the news: Business man in suit and tie smiling and reading a newspaper near the financial district.

The 13 shipments, worth about $1.5 billion at formula prices for Venezuela’s flagship-grade Merey crude, were declared "crude oil" at Chinese customs, without specifying origin, said one of the sources.


"These shipments are strictly under a government mandate, where CASIC was designated to move the oil as payment to offset Venezuelan debt (to China)," the person said. All three sources spoke on condition of anonymity due to the sensitivity of the matter.



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