Venezuela’s re­cent oil ship­ments to Syria may pro­voke sanc­tions

‘Might be in­ter­me­di­aries in­volved’

The Washington Times Daily - - World - BY KELLY HEARN

BUENOS AIRES | Venezuela re­cently shipped fuel to a Syr­ian firm de­spite U.S. gov­ern­ment sanc­tions, in moves that could open the South Amer­i­can na­tion to puni­tive U.S. mea­sures, ac­cord­ing to en­ergy an­a­lysts.

An­a­lysts say they have no doubt that the state-owned firm, Petroleum Venezuela, dealt with Syria’s state oil com­pany, Sytrol.

The U.S. Trea­sury Depart­ment placed Sytrol on a sanc­tions black­list last sum­mer, along with the Syr­ian Petroleum Corp. and the Syr­ian Com­pany for Oil Trans­port (SCOT), which op­er­ates ma­jor oil ex­port ter­mi­nals.

“Any deal­ings by for­eign firms with these black­listed com­pa­nies would tech­ni­cally be sanc­tion­able,” said Le­jla Alic, an econ­o­mist at the U.S. En­ergy In­for­ma­tion Agency.

Although ship­ping oil to Syria for hu­man­i­tar­ian rea­sons is not sub­ject to sanc­tions, the Venezue­lan oil com­pany would have dealt with the black­listed firms, an­a­lysts said.

“There might be in­ter­me­di­aries in­volved in the ship­ments, but the Syr­ian state had to have re­ceived them,” said Pe­dro Burelli, a for­mer mem­ber of the board of di­rec­tors of the state firm, known by its Span­ish ini­tials PDVSA.

“There is sim­ply no­body on the pri­vate side who has lo­gis­tics to do so.”

A ship­ping con­sul­tant who asked not to be iden­ti­fied be­cause he does busi­ness with PDVSA agreed.

“The his­tory of diesel go­ing into Syria has al­ways been through Sytrol,” he said.

“It’s pos­si­ble they could have put some com­pany in busi­ness to re­ceive these ship­ments, but I’m sure it ended up with Sytrol and that’s how it got put into the sys­tem.”

En­ergy an­a­lysts for the U.S. gov­ern­ment also agreed that the ship­ments were likely han­dled by Sytrol.

Venezue­lan Oil Min­is­ter Rafael Ramirez has con­firmed me­dia re­ports that PDVSA sent two ship­ments of fuel to Da­m­as­cus af­ter Western sanc­tions were im­posed on the Syr­ian regime, which is ac­cused of killing thou­sands of pro­test­ers against the gov­ern­ment.

“We’ve sent Syria two car­goes of diesel [fuel], and ship­ments will con­tinue as they are needed,” Mr. Ramirez said. “We have a high de­gree of friend­ship and co­op­er­a­tion with Syria.”

One cargo of diesel fuel with an es­ti­mated value of $ 50 mil­lion left Venezuela in Fe­bru­ary on the tanker Ne­gra Hipolita. It was bound for the Syr­ian port of Ba­nias. A ship­ment was sent in Novem­ber.

On March 5, a Venezue­lan con­gress­man, Adel El Zaba­yar of Mr. Chavez’s party, told re­porters that PDVSA is plan­ning a third ship­ment.

An­a­lysts also say Washington could re­tal­i­ate against Venezuela — which also owns the Texas-based com­pany Citgo and sup­plies crude oil to U.S. Gulf Coast re­finer­ies — by re­strict­ing PDVSA’S ac­cess to Amer­i­can fi­nan­cial in­sti­tu­tions.

That, how­ever, could have a neg­a­tive im­pact on Citgo and ul­ti­mately spell trou­ble at the gas pumps, where the price of a gal­lon of gas is in the $4 range.

“Venezuela rep­re­sents 8 per­cent of U.S. im­ports, so any ac­tion against it could drive up gas prices,” said Boris Se­gura, a Latin Amer­i­can an­a­lyst for No­mura Se­cu­ri­ties.

A Trea­sury Depart­ment rep­re­sen­ta­tive said the depart­ment does not com­ment on pos­si­ble en­force­ment ac­tions.

Last year, Washington slapped par­tial sanc­tions on PDVSA for sup­ply­ing fuel prod­ucts to Iran. Those mea­sures did not re­strict Venezue­lan oil ex­ports to the U.S. or af­fect Citgo in any way.

“[Pres­i­dent Hugo] Chavez does not fear sanc­tions and, as a mat­ter of fact, might ac­tu­ally be tempt­ing them for his own gain,” said Mr. Burelli.

Mr. Chavez, who is fac­ing a lifethreat­en­ing re­cur­rence of can­cer, is in a tough po­lit­i­cal pres­i­den­tial re-elec­tion cam­paign against an in­creas­ingly pop­u­lar op­po­nent, Hen­rique Capriles. The elec­tion is slated for Oc­to­ber.

“He will use any po­si­tion Washington takes against him to make it seem like he isn’t fight­ing any­body but the U.S., and that the [do­mes­tic po­lit­i­cal] op­po­si­tion is just a lackey,” Mr. Burelli said.

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