India’s Reliance will load its first cargo of Venezuelan crude in three months this week in exchange for diesel under a swap deal the parties say is permitted under the US sanctions regime on the Latin American country, according to a Reliance source and a shipping document from state oil firm PDVSA.
Washington has exempted some Venezuelan oil trade from sanctions, when transactions are in exchange for fuel and food or to repay debts rather than for cash. But that trade slowed as the US tightened restrictions and refiners, shippers and insurers have been steering clear of Venezuela to avoid any risk they may fall foul of sanctions.
Washington aims to deprive Venezuelan socialist President Nicolas Maduro of his main source of revenue with the sanctions, which have driven Venezuelan oil exports to their lowest level since the 1940s.
Reliance gave the US State Department and the Office of Foreign Assets Control (OFAC) notice of the diesel swap and received word back that the policies that allowed the transaction were still in place, the Reliance source told Reuters.
Reliance has previously said that its supplies of fuel to PDVSA in exchange for crude were permitted under sanctions.