Published On: Mon, Nov 26th, 2018

Rosneft chief rebukes Venezuela oil shipments

Igor SechinWASHINGTON, MEXICO CITY - The head of Russian oil company Rosneft, Igor Sechin, flew to Caracas last week to meet Venezuelan President Nicolas Maduro and complain over delayed oil shipments designed to repay loans, two sources briefed on the conversation said on Saturday.

The visit, which was not publicly disclosed, is one of the clearest signs of strain between crisis-stricken Venezuela and its key financier Russia.

Over the last few years, Moscow has become Venezuela’s lender of last resort, with the Russian government and Rosneft handing Venezuela at least $17 billion in loans and credit lines since 2006.

State oil company PDVSA is repaying almost all of those debts with oil, but a meltdown in its oil industry has left it struggling to fulfill obligations.

Sechin and a large delegation of executives met with officials at PDVSA in a Caracas hotel last week. Sechin also met with Venezuela’s leftist leader Maduro, and chided him over oil-for-loans shipments that are behind schedule.

“He brought information showing that they were meeting obligations with China but not with them,” said one source with knowledge of the talks.

“They’re running around in PDVSA because of this,” added the source, asking to remain anonymous because he was not authorized to speak to media.

The country’s oil production has fallen to just 1.17 million barrels-per-day, a 37 percent drop in the last year, according to reports from secondary sources to OPEC, leaving it struggling to ship Russian entities the roughly 380,000 bpd it has agreed to send, according to PDVSA documents.

The closing of a dock at Venezuela’s main oil export port, through which the vast majority of shipments to Rosneft transit, has delayed millions of barrels in crude since August.

Sechin handed Maduro graphics about oil shipments to Russian entities compared with China, the two sources said.

Top financier China, which has plowed more than $50 billion into Venezuela, also gets reimbursed in oil.

According to Reuters calculations based on PDVSA data, the Caracas-based company delivered around 463,500 bpd to Chinese firms between January and August, a roughly 60 percent compliance rate. That compares with around 176,680 bpd to Russian entities, or a 40 percent compliance rate.

Rosneft and PDVSA did not immediately respond to a request for comment. One of the sources with knowledge of Sechin’s visit, as well as two separate sources, said a Chinese delegation was also in Caracas this week.

Photo: Deputy Prime Minister Igor Sechin (AP Photo/ Alexander Zemlianichenko)

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