US imports of ‘sanctioned’ Venezuelan oil surge fivefold

Purchases of Venezuelan crude by US energy companies saw a five-fold weekly growth as of the middle of February, nearly reaching their pre-sanctions level, the latest data published by the International Energy Agency (IEA) shows.

According to the Paris-based agency, imports of crude from Venezuela to the US amounted to 558,000 barrels per day during the week through February 15, compared to 117,000 barrels per day in the previous week. As of January 25, just days before US sanctions came into effect, American firms reportedly imported 587,000 barrels per day.

Washington imposed economic penalties against Venezuela’s state oil giant PDVSA, freezing $7 billion of the company’s assets. The sanctions also block payments to PDVSA accounts with buyers of Venezuela’s oil directed to deposit all transactions in a separate account, to which the company doesn’t have access.

The US Treasury issued temporary permits for buying Venezuelan crude to foreign companies until the current deals are expired, and the firms find new suppliers with the deadline set by the White House to expire on April 28.

The latest sanctions also prohibit US sales of naphtha to the Bolivarian Republic. Naphtha is a mixture, produced from natural gas condensates or petroleum distillates, which is used to dilute thick, heavy crude to make it flow.

The US penalties forced Caracas to purchase naphtha, as well as petrol and diesel, from Russian state oil corporation Rosneft, Indian conglomerate Reliance Industries, as well as Dutch commodity traders Vitol and Trafigura, according to ship-tracking data seen by Reuters.

Washington and Caracas have been involved in a longstanding diplomatic spat for years. In January, Venezuelan President Nicolas Maduro announced a break of diplomatic relations with the US after President Trump recognized the leader of Venezuela's National Assembly Juan Guaido as the country’s interim president.