Russia Steps up Energy Exports to Venezuela after U.S. Sanctions – Bloomberg

Russia has surpassed the US as Venezuela’s prime naphtha supplier as Washington’s trade policies push the two sanctioned countries into deeper economic cooperation.

This came in a Bloomberg News report seen by Ukrinform.

US shipments of naphtha fell to zero from March until October, while flows from Russia have totaled more than seven million barrels over the same time frame, according to Kpler.

The supplies, equal to about 49,000 barrels a day in August and 69,000 a day in September, also represent the first recorded wave of naphtha deliveries to travel from Moscow to Caracas in nearly six years.

Venezuela needs naphtha, a product that can be used as a diluent, to thin its tar-like crude and keep oil moving through pipelines to be exported to countries such as China, one of its top buyers, the report says.

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Venezuela began searching for a new provider of naphtha after US President Donald Trump tightened up sanctions on its oil sector earlier this year, revoking Biden-era licenses for several energy companies operating in the country, including Chevron.

The revocation of Chevron’s license capped the US’s roughly 18-month run as Venezuela’s near-exclusive supplier of naphtha, an arrangement that had offered US refiners a convenient market for surplus of light products.

Venezuela then asked China and Iran to help fill the gap, unsuccessfully, however, according to Bloomberg.  But Russian naphtha quickly emerged as a better quality and likely cheaper alternative to Iranian condensate.

Venezuelan President Nicolas Maduro’s government said this month it had signed a partnership agreement with Russia that would advance joint efforts in energy and defense.

While Russia and Venezuela have had various oil and gas agreements in the past, the new supply line allows Moscow to unload surplus naphtha after losing access to European markets amid international sanctions over its invasion of Ukraine.

Russia’s ongoing war in Ukraine could complicate matters. Moscow’s refining network has been battered by Ukrainian drone strikes, raising questions over product availability. Ust-Luga, an export terminal in the Baltic Sea accounting for nearly 7 percent of Russian naphtha exports to Venezuela, according to Vortexa data, sustained extensive damage from attacks in late August.

It has been reported by Ukrinform that Taiwan has become the world’s top importer of Russian naphtha, a petroleum product crucial in making semiconductors, despite the country joining Western sanctions against Russia.

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