A shipping joint venture between Venezuela and China has fallen apart in the wake of U.S. sanctions, resulting in the South American nation losing three supertankers at a time when foreign shippers are reluctant to carry its oil.
PetroChina Co Ltd, which had been state-run Petroleos de Venezuela’s partner in the Singapore-based joint venture CV Shipping Pte Ltd, took control of the three tankers between January and February 2020.
The transfer of the Junin, Boyaca and Carabobo very large crude carriers (VLCC) has not been previously reported.
It came after U.S. sanctions on PdVSA left the vessels without insurance, leading to millions of dollars in losses for CV Shipping and prompting PetroChina to place it in bankruptcy.
The original purpose of the venture was to ship Venezuelan oil to China and some other export destinations.
PdVSA’s loss of the three tankers, which carry each up to 2 million barrels of oil, comes as it is more dependent than ever on its in-house fleet.
Washington is intensifying its 18-month campaign to oust Venezuelan President Nicolas Maduro by sanctioning third-party vessels that transport the OPEC nation’s oil.
That has prompted major Greek shipping firms, some of whose vessels have been sanctioned for transporting Venezuelan crude, to stop working with PDVSA, prompting Venezuelan oil exports to collapse completely.
PdVSA has until now managed to retain a fourth VLCC from the venture, the Ayacucho. But a U.S. glass manufacturer seeking to collect a $500 million arbitrary award for Venezuela’s 2010 expropriation of two factories is suing in Singapore court to seize that tanker.
Petrochina moved to place CV Shipping into court-administered liquidation in Singapore in January 2020, around a year after Washington first sanctioned PDVSA to try to cut off oil revenue to Maduro, who firmly remains in power.
China remains one of the main importers of Venezuelan crude, mostly by way of ship-to-ship transfers that make it appear as if the origin of the crude is Malaysia.
Asia Times / ABC Flash Point Oil Shipping News 2020.