At least nine tankers delivered 3.19 million barrels of Russian oil and oil products to American ports during the week between 23 February and 1 March, RBC news agency reports, citing a notice sent out by the investment bank Caracas Capital Markets, which specializes in Venezuela. The bank believes that the increase in Russian oil shipments to the US is a result of “the US market adapting to the loss of Venezuelan oil”.
Most of the shipments in the last week of February were either naphtha or fuel oil. Tankers came to the US from Novorossiysk and St. Petersburg, Caracas Capital reports, citing the US consignment database.
The week’s 3.19 million barrels is “the largest volume from Russia we have seen since 2011” wrote Caracas Capital partner Russ Dellen. “Ironically, the Russians are profiting from Venezuela’s collapse: one hostile country under sanctions is being replaced by another hostile country under sanctions in shipments to the US,” Dellen remarked.
In November 2018 (the most recent available data), the US was importing 254,000 barrels per day of Russian oil and oil products, which equates to approximately 1.8 million barrels per week, around 2.8% of the US’s total oil imports.
According to Caracas Capital, only one tanker delivered oil to the US directly from Venezuela during the week ending on 1 March. The daily volume from Venezuela for last week thereby dropped to 83,000 barrels per day as compared to the 587,000 at the end of January, according to the US Energy Information Administration. The missing volume from Venezuela has been partially replaced by shipments from Mexico and Saudi Arabia, which have doubled to 915,000 and 697,000 barrels per day, respectively. The administration does not cite any data about oil shipments from Russia.
According to the US Treasury Department, American clients have until 28 April 2019 to import Venezuelan oil without the risk of secondary sanctions. However, since payments for this oil must be made to a special bank account in the US for frozen funds, Venezuela has virtually no reason to continue delivering to the US.
Russia has also been shipping oil products to Venezuela, Bloomberg reported on 5 March, citing its own sources. At the end of January, the Russian oil company Rosneft dispatched a batch of heavy ligroin to Venezuela for the first time since sanctions were imposed on the Venezuelan state-owned oil company PDVSA. Ligroin is needed to dilute the viscous Venezuelan oil so that it can be pumped through pipes to the coast for export. Two tankers commissioned by Rosneft, the “Serengeti” and “Abliani”, are scheduled to deliver 1 million barrels of oil products to Venezuela from Europe.