More than $1 billion worth of Venezuelan oil has been sold in China as Brazilian over the past 10 months, Reuters has reported, citing cargo tracking data and industry sources who wished to remain unnamed.
The rebranding of the crude has cut transportation costs for Venezuelan crude and facilitated U.S. sanction circumvention, the report noted. Before, traders resorted to ship-to-ship transfer at sea to mask the crude but now they have taken to manipulating vessels’ location signals to make it look like they are travelling from Brazilian ports instead of Venezuelan ones, data from TankerTrackers.com has shown, per Reuters.
The publication then cited Chinese customs data as showing imports of mixed bitumen from Brazil flowed in at a rate of 67,000 barrels daily between July2024 and March this year. However, Brazil’s Petrobras does not export bitumen to China.
“What we export to China is mainly crude oil from the pre-salt, it's not bitumen,” Reuters cited Petrobras chief executive Magda Chambriard as saying at a recent industry event.
Venezuela, however, is famous for its heavy crude, which it sells under the name Merey, mostly to Chinese so-called teapot refiners, who take advantage of the fact there are no government-set quotas for bitumen purchases. The oil gets its certificate of origin changed from Venezuela to Brazil and can be shipped as Brazilian crude around sanctions.
Meanwhile, the United States has once again tightened the noose around Caracas, with President Trump announcing last month that any country that buys oil or gas from Venezuela will pay a 25% secondary tariff on trades with the United States.
The U.S. federal government also revoked Chevron’s license to operate in Venezuela and cancelled some planned cargos, which dealt an immediate blow to Venezuela’s oil exports, slashing them by 20% in April from March, to some 700,000 barrels daily—the lowest export rate in nine months.
By Irina Slav for Oilprice.com
