Reliance, Venezuela’s PDVSA resume oil swap under U.S. authorisation, shows document

“Before sanctions, India was Venezuela’s second largest market for its crude,” according to ship tracking data.
| Photo Credit: Reuters

“Reliance Industries and Venezuela’s state oil company PDVSA have resumed an oil swap that had been paused owing to U.S. sanctions on the South American country,” according to an internal PDVSA document showed on Thursday (December 19, 2024.)

Reliance and other refiners had imported Venezuelan oil earlier this year under a broad U.S. license that expired in April. In July, Washington granted Reliance an individual authorisation green-lighting the trade.

“Before sanctions, India was Venezuela’s second largest market for its crude. Owing to the U.S. measures and separate licenses issued to some of PDVSA’s joint venture partners, China has this year remained the main destination for Venezuela’s oil, followed by the United States and Europe,” according to ship tracking data.

Reliance Industries denies any cash payment for Venezuelan oil

“A supertanker carrying about 1.9 million barrels of Venezuelan Merey heavy crude departed earlier this month for Sikka port in Gujarat, while a unit of Reliance delivered a 5,00,000-barrel cargo of heavy naphtha to PDVSA this month in exchange,” according to the document. PDVSA and Reliance did not immediately reply to requests for comment.

“Reliance, which operates the world’s biggest refining complex, plans to pay in cash for the balance of the crude purchases after the swaps,” a source told Reuters in August, in an arrangement similar to past exchanges.

U.S. President-elect Donald Trump told reporters this week his country does not need oil from Venezuela, which currently exports about 2,40,000 barrels per day (bpd) to the United States, mostly shipped by oil producer Chevron. Chevron did not provide comment on Mr. Trump’s remarks.

Possible changes in the U.S. sanctions regime on Venezuela, which since 2019 works through a combination of executive orders and licenses, could lead to a new interruption of the Organization of the Petroleum Exporting Countries’ (OPEC) heavy oil flows to the U.S., while also halting Venezuela’s imports of refined products from the United States.

“If that happens, the Venezuelan barrels currently exported to the U.S. are expected to be redirected to Asian destinations,” analysts and experts have said.

Venezuela’s government has said the U.S. sanctions are illegitimate measures that amount to an “economic war” designed to cripple Venezuela. President Nicolas Maduro and his allies have cheered what they say is the country’s resilience despite the measures.