Rosneft Sells Venezuelan Assets to Russia After U.S. Sanctions Ramp Up

OILMONSTER.COM- Russia’s largest oil producer, Rosneft, said on Saturday it had terminated operations in Venezuela and sold the assets linked to its operations in the South American nation to an unnamed company owned by the Russian government.

The impact of the move, announced at a time when oil prices are languishing at around $25 per barrel, on Rosneft’s upstream joint ventures with Venezuelan state oil company Petroleos de Venezuela was not immediately clear.

The U.S. government has ramped up pressure on Venezuelan President Nicolas Maduro’s government, including imposing sanctions on two Swiss-based Rosneft units - Rosneft Trading and TNK Trading International - that Washington said provided PDVSA a lifeline by acting as intermediaries for its crude.

The change of ownership announced on Saturday means any future U.S. sanctions on Russian-controlled oil operations in Venezuela would target the Russian government directly.

Russia, via the state company Rosneftegaz, owns slightly over 50% of Kremlin-controlled Rosneft’s capital. International shareholders include BP, which has 19.75%, and Qatar via QH Oil Investments LLC, which owns another 18.93%.By withdrawing from Venezuela and passing its assets to an entity owned by Moscow, Rosneft, headed by Igor Sechin, a close ally of President Vladimir Putin, transfers the risks related to its Venezuelan operations to the Russian government.

The U.S. State Department did not immediately respond to a request for comment.

Courtesy: www.reuters.com