Venezuelan oil exports to Europe to resume in two years, Reuters sources

© Reuters. The logo of the Italian energy company Eni can be seen at a gas station in Rome, Italy, September 30, 2018. REUTERS / Alessandro Bianchi

By Mariana Paraga

(Reuters) – A 650,000-barrel cargo of Venezuelan oil hired by Italy’s Eni is set to sail with the first crude oil exports from the US-sanctioned country to Europe in two years, Refinitiv Eikon data showed on Friday.

The US State Department sent letters to Eni and Spain’s Repsol (OTC 🙂 in May, authorizing them to resume taking Venezuelan oil as a way to settle billions of dollars in unpaid debt and dividends owed by the OPEC member state.

A second tanker, hired by Eni, the very large carrier of raw crude (VLCC) Pantanassa, is currently heading to Venezuela and is expected to load 2 million barrels of the same class, diluted (DCO) and take it to Europe, according to Eikon and a transport document seen by Reuters.

The cargo is expected to be delivered by Venezuela’s state PDVSA later this month with an option for Eni to sell some of Spain’s crude oil to Repsol for its refineries in Cartagena and Bilbao, according to the document and sources.

The Maltese-flagged Pantanasa is scheduled to be loaded by ship-to-ship transfer near Venezuela’s port of Amuay, the document added.

Eni, Repsol and PDVSA did not respond immediately to requests for comment.

Venezuela’s oil exports fell to a 19-month low in May due to changes in contracts imposed by PDVSA to shift most spot sales to prepay, reducing the risk of unpaid freight. The change did not affect customers in debt swap agreements.

European, Asian and American companies operating joint ventures with PDVSA in Venezuela, including Eni, Repsol, Chevron (NYSE :), ONGC Ltd and Maurel & Prom have amassed billions of dollars in debt after the government of then-US President Donald Trump stopped oil swaps used to exchange Venezuelan oil for fuel and debt payments.

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