Some sanctioned oil vessels divert from Venezuela as Trump threatens blockade
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Author of the article:You can save this article by registering for free here. Or sign-in if you have an account.MIAMI (AP) — Some oil vessels are diverting away from Venezuela after U.S.
President Donald Trump threatened a “blockade” of sanctioned oil tankers entering or leaving the South American country, a dramatic escalation in the White House’s pressure campaign on leader Nicolas Maduro.Subscribe now to read the latest news in your city and across Canada.Subscribe now to read the latest news in your city and across Canada.Create an account or sign in to continue with your reading experience.Create an account or sign in to continue with your reading experience.Trump said Tuesday on social media, in all caps, that he is ordering a “total and complete blockade of all sanctioned oil tankers” into and out of Venezuela, a move that threatens to choke off revenue from the world’s largest oil reserves that are key to Maduro’s grip on power.It’s not clear exactly what Trump meant by his threats. U.S. sanctions adopted during his first administration make it illegal for Americans to purchase Venezuela’s crude oil without a license from the Treasury Department.Get the latest headlines, breaking news and columns.By signing up you consent to receive the above newsletter from Postmedia Network Inc.A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Top Stories will soon be in your inbox.We encountered an issue signing you up. Please try againInterested in more newsletters? Browse here.Additionally, hundreds of ships themselves have been sanctioned — part of a massive shadow fleet of often aging vessels that has proliferated in recent years to transport oil on behalf of Iran, Russia, Venezuela and other U.S. adversaries under sanctions.Some ships under sanctions are changing courseAt least 30 vessels under sanctions are navigating near Venezuela, according to Windward, a maritime intelligence firm that helps U.S. officials target the shadow fleet. A few have started to change their course, perhaps fearing they could face the same fate as the Skipper, a sanctioned vessel seized by U.S. forces last week near Venezuela.“It’s quite clear that this has disrupted energy flows to and from Venezuela,” said Michelle Wiese Bockmann, a senior analyst at Windward. “Every hour when we’re tracking these vessels, we are seeing tankers that are deviating, loitering or changing their behavior.”Among those is the Hyperion, which had been sailing toward the Jose port in Venezuela before doing a 90-degree turn early Wednesday and starting to head north away from the South American mainland.The vessel, previously part of Russia’s state-owned shipping fleet, was one of 173 sanctioned in the final days of the Biden administration for allegedly facilitating Russian oil sales in violation of sanctions over Moscow’s invasion of Ukraine.Following the penalties, the vessel changed its flag from the Comoros to Gambia. But the West African nation deleted Hyperion _ along with dozens of other vessels — from its privately run ship registry in November for allegedly using false certificates claiming to have been issued by its maritime authority.The vessel’s ownership also is obfuscated under multiple layers of offshore companies, some of them listed in Dubai, United Arab Emirates.“It’s just screaming that it’s in a position to be seized,” Wiese Bockmann said.Venezuela has a shadow fleet, but so far its unsanctioned oil isn’t affectedSince the first Trump administration imposed punishing oil sanctions on Venezuela in 2017, Maduro’s government has boosted its reliance on a network of rogue tankers to smuggle a growing share of the roughly 900,000 barrels of oil per day that the OPEC nation produces.Sanctioned tankers carried about 18% of Venezuela’s international shipments during the second half of this year, up from 6% in the first half of the year, according to Jim Burkhard, global head of oil markets and mobility at S&P Global Energy.Burkhard said that while supplies to China, the main destination for most Venezuelan oil, could be affected, he doesn’t expect any major disruption to oil markets.“Volatility or uncertainty around Venezuela is not new, it’s not a shock,” he said. Markets also react more when supplies of oil are scarce, and “the market today is not tight. There’s plenty of oil.”Unaffected for now is the roughly 143,000 barrels per day of Venezuelan heavy crude sent to U.S. refineries along the Gulf coast, much of it transported by Chevron, which has a waiver to operate in Venezuela.“Chevron’s operations in Venezuela continue without disruption and in full compliance with laws and regulations applicable to its business, as well as the sanctions frameworks provided for by the U.S. government,” spokesman Bill Turenne said.Still, for the industry’s rogue actors, Trump’s threat of a blockade represents a paradigm shift.“There are already ships that have decided not to leave Venezuela for fear of being seized, and there are also ships headed to Venezuela to load crude oil that decided to turn back,” said Francisco Monaldi, a Venezuelan oil expert at Rice University in Houston.That’s good news for the oceans, where hundreds of vessels, many without insurance and poorly maintained, were a constant menace.“Many of these are no more than floating rust buckets,” said Wiese Bockmann, the Windward analyst. “So irrespective of the sanctions and the geopolitical reasons for their being targeted, it is a good thing to have a strategy to deal with them and to remove them from trading.”___Associated Press writer Michael Biesecker and Michelle L. Price in Washington, Regina Garcia Cano in Caracas, Venezuela, and David McHugh in Frankfurt, Germany, contributed to this report.Postmedia is committed to maintaining a lively but civil forum for discussion. Please keep comments relevant and respectful. Comments may take up to an hour to appear on the site. You will receive an email if there is a reply to your comment, an update to a thread you follow or if a user you follow comments. Visit our Community Guidelines for more information.