Report: Russian fuel flowing thousands of miles to Venezuela

MOSCOW, Aug 2 (PRIME) -- Russian oil products are making their way to sanction-stained Venezuela, affording a reprieve for the Latin American nation as it battles persistent fuel shortages, Bloomberg reported late on Thursday, citing people familiar with the cargoes and ship-tracking data.

Venezuela received at least 616,000 barrels of gasoline and 500,000 of vacuum gas oil, a feedstock used to produce gasoline, in June and July. The cargoes sailed from the Black Sea port of Taman to Malta, where they were transferred to other vessels heading to Venezuela

More Russian cargoes could be coming as the vessel Commander, which loaded VGO in Taman in late July, is also heading for Malta, one of the people said. Tanker-tracking data confirm the movement.

The fuel shipments could help Venezuela ease its gasoline crisis. Once an exporter of gasoline to the Caribbean and the U.S. East Coast, the country now must import almost of all of its fuel amid breakdowns at its domestic refineries. Before sanctions imposed by U.S. president Donald Trump, Venezuela imported most of its gasoline from the U.S. and India, but recently switched to supplies from Turkey, Latvia, Greece and now Russia.

It’s a long trip. Gasoline vessels from Russia take 30 days to Venezuelan shores, while supplies from the U.S. arrive in a little over than a week, according to data compiled by Bloomberg.

“Russia is probably charging a premium for these cargoes because of sanctions,” said Andy Lipow, president of Lipow Oil Associates LLC. “It’s unusual that Black Sea gasoline is making its way over to this side of the Atlantic,” he said in a phone interview from Houston.

Russia froze domestic gasoline prices in the first half of this year, making fuel exports a more attractive option. From July, the government removed the cap but reached an informal agreement with producers to keep retail and wholesale prices growing in line with inflation, according to Vedomosti.

Russia has been a traditional ally for Venezuela, with the Kremlin voicing support to Nicolas Maduro on many occasions after relationships between governments in Caracas and Washington deteriorated. Russia’s largest oil producer, Rosneft Oil PJSC, has received crude oil from Venezuela state oil company Petroleos de Venezuela SA under pre-payment supply deals. Russia is also one of the largest foreign investors in Venezuela’s upstream segment.

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