Defying US sanctions against Caracas, China has assigned a defense firm to ship millions of barrels of Venezuelan oil as part of a deal to offset the sanctions-battered Latin American country’s debt to Beijing.
Since November 2020, China Aerospace Science and Industry Corp (CASIC) has been carrying Venezuelan crude on three tankers it acquired that year from PetroChina, affiliated with China National Petroleum Corp (CNPC), Reuters reported Friday citing unnamed sources as well as tanker tracking data.
According to the report, CNPC stopped carrying Venezuelan oil in August 2019 after the US tightened its sanctions against the Central American exporter, though it continued to find its way to China via traders who rebranded the fuel as Malaysian.
The three CASIC tankers load in Venezuela with their transponders active, allowing third-party tracking, Eikon data showed.
The Chinese company has so far taken 13 cargoes carrying a total of nearly 25 million barrels of oil, including two vessels due to arrive in China next month, the report added, citing loading schedules of Venezuelan state oil firm PDVSA, and tanker tracking data from Refinitiv and Vortexa Analytics.
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, according to one of the sources cited in the report.
“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 unnamed source claimed.
“All money from proceeds stays in China. Venezuela’s foreign affairs ministry is in charge of conciliation and accountability,” the source further added.
At roughly 42,000 barrels a day, these shipments have increased total Venezuelan oil to China to nearly 420,000 BPD between January and July this year, equivalent to about three percent of China’s consumption, the report added, citing Emma Li, an analyst with Vortexa, which tracks such flows.
It noted that Beijing has not officially reported any crude oil imports from Venezuela since October 2019.
China manages its crude imports under a rigid quota system for qualified refiners, the report further claimed, citing one of its sources as adding that the CASIC shipments are an exception, with no quota.
“They enter China under a special green channel,” the source stressed.
The US Treasury Department, which enforces brutal US sanctions against countries that refuse to accept its diktats, declined to comment on the report.
According to PDVSA’s loading schedules and ship tracking by Vortexa and Refinitiv, the CASIC’s Venezuelan oil shipments are hauled by three Very Large Crude Carriers — Xingye, Yongle and Thousand Sunny.
CASIC took over the vessels from PetroChina in 2020, shortly after PetroChina took control of them after a legal dispute with PDVSA over assets involved in a joint venture bankruptcy, the report also stated citing “two sources.”
PetroChina also transferred to CASIC a tank farm based in the eastern coastal city of Ningbo, where the shipments are delivered, the sources further claimed.
This originally appeared on Press TV.
