The Trump administration is considering imposing sanctions on companies from third countries that facilitate the shipment of Venezuelan oil to Cuba, a senior administration official told the Miami Herald.
“The interim president of Venezuela, Juan Guaidó, recognized by the U.S. and Europe, where most of these companies are from, has asked us to stop these shipments and we are considering everything to be supportive,” the official said.
The Venezuelan National Assembly, controlled by the opposition, agreed to suspend the shipment of crude oil to Cuba as part of a state of emergency decree approved on Monday to respond to the chaos caused by a major electrical blackout. Guaidó published on Twitter a chart estimating that the Nicolás Maduro regime sends 47,000 barrels of oil per day to Cuba, the equivalent of about $2.5 million under current world oil prices.
The decision “to cut the oil supply to Cuba asserts our independence,” Guaidó wrote on Twitter. “Cuban interference must cease in our #FANB [Bolivarian National Armed Forces]. And the income from oil should boost the reconstruction of Venezuela.”
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The U.S. official said the administration is “aware of these shipments, we know where they are and who the companies are.” The official said both the U.S. and the interim Venezuelan government could choose to take legal action against the companies. The U.S. has imposed similar sanctions on companies facilitating trade with North Korea and Iran. There are other steps the U.S. can take to increase pressure on the Maduro government, the official said, including the interdiction of oil shipments, “but we´re on step 1.”
Through an agreement between the late Fidel Castro and Hugo Chávez to exchange oil for medical services, Venezuela sends between 40,000 and 50,000 barrels of oil a day to Cuba, almost half of what it supplied a few years ago before oil production plunged under Maduro.
“The most recent shipment we have been able to document was the Despina Andrianna tanker that sailed from Puerto La Cruz, Venezuela, on February 22 with approximately 400,000 barrels of crude oil and arrived at the port of Matanzas on February 28,” said Jorge Piñón, director of the Latin America energy program at the University of Texas at Austin.
In the midst of the deepest drop in oil production in 33 years, Venezuelan oil company PDVSA also bought $440 million in Russian oil to ship to Cuba between January 2017 and May 2018, according to documents obtained by Reuters. The company paid $12 more per barrel than the subsidized price for shipments under the barter agreement with Cuba.
These shipments could stop or be substantially reduced if the National Assembly, with the aid of the U.S. government, succeeds in stopping the shipments or at least disrupts their transportation.
The National Assembly appears to have taken control of Citgo, the PDVSA subsidiary in the United States, and appointed a new board to run PDVSA, but it is not clear yet how much control it has over the national oil firm. According to Piñón, oil shipments to Cuba depart not only from Venezuela but also from Curaçao, where PDVSA has a refinery.
PDVSA uses two tankers belonging to Transportes del Alba, a Cuban-Venezuelan company, to carry out some of the shipments, but those ships are registered under the Panamanian flag, a common practice of governments that prefer to register their ships in other countries to avoid restrictions and tighter regulations.
These flag carriers, as well as those that insure those shipments, among others, are now “under notice,” presidential adviser John Bolton wrote on Twitter.
Follow Nora Gámez Torres on Twitter: @ngameztorres