An investigative report by Reuters has discovered that Venezuela was avoiding U.S. oil sanctions with the help of none other than the United Arab Emirates.
Back in June 2020, the US began sanctioning at least 6 oil tankers managed by established shipping firms.
The slack was picked up by a little-known company based in the United Arab Emirates.
The vessels were renamed and then began shipping again.
Each week, we discover sophisticated methods to hide oil shipments, but this week the prize goes to ALSATAYIR (IMO 9308845), an Aframax crude oil tanker that is about to load 700K barrels of oil in Venezuela. All they did was paint over "AL" and "YIR". #OOTT🏆 pic.twitter.com/huWTMCOKRu
— TankerTrackers.com, Inc.⚓️🛢 (@TankerTrackers) December 29, 2020
“The company, Muhit Maritime FZE, is one of three UAE-based entities identified by Reuters that have shipped Venezuelan crude and fuel during the second half of this year.
Their role emerges from an examination of internal shipping documents from Venezuela’s state oil company as well as third-party shipping and vessel tracking data.
Tankers managed by the firms have transported millions of barrels of oil produced by state-run Petroleos de Venezuela SA, or PDVSA, since June, according to the internal documents and a publicly available shipping database.”
Basically, if a tanker is sanctioned, there’s immediately a new one to replace it.
“The three companies – Muhit Maritime, Issa Shipping FZE and Asia Charm Ltd – did not respond to letters sent to their listed addresses, or to emails sent to their registered email addresses. Reuters was unable to determine the ultimate owners of the three. Their ownership and management details aren’t listed in the UAE’s publicly-available corporate registry.”
Initially, companies were popping up buying Venezuela’s oil, but now transport companies are also popping up to handle that part of the logistics as well.
The three companies’ shipments of Venezuelan crude and fuel represented about 3.9% of the South American country’s total oil exports in 2020 through December 18th.
“We are closely tracking these kinds of creative efforts by companies to evade sanctions,” a U.S. State Department spokesman said in response to questions about the UAE-registered firms. “Those behind shell companies would not be wise to consider themselves shielded from sanctions.”
The spokesman declined to comment on possible future sanctions, but added: “U.S. friends and adversaries alike should know that their companies, front companies, and tankers remain vulnerable to sanctions if they are complicit in activities that facilitate PDVSA’s exports abroad and the Maduro regime’s efforts to evade sanctions.”
The UAE itself admitted it was investigating into what was going on.
It said in a statement that “a thorough and comprehensive investigation is fully underway into” Muhit Maritime, Issa Shipping and Asia Charm.
That includes using recent legislative changes “designed to improve corporate transparency through a framework for reporting and registering beneficial ownership,” it said.
“The UAE takes its role in protecting the integrity of the global financial system extremely seriously. This means actively administering and enforcing economic and trade sanctions,” the government added.
Washington failed in its regime change attempt against Venezuelan President Nicolas Maduro, but the U.S. sanctions have nearly crushed Venezuela’s oil sector. Exports plummeted by a third in 2019 to around 1 million barrels a day. By this October, they hit a decades-low level of 359,000 barrels a day. But Caracas keeps trying to move the crude. In November, daily exports nearly doubled, thanks to the emergence of new, little-known customers.
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