Oil traders are flocking to sanctions-free Venezuela
gold sourced from illegal mines. The architect of much of the sanctions-busting was a former oil minister, Tareck El Aissami. Once the golden boy of the regime, he has not been heard of since March, when he said on social media that he supported a corruption inquiry which revealed that PDVSA had not been paid for more than 80% of the oil it had shipped, to the tune of $21bn.
He is rumoured to be under house arrest in Caracas. The recent return to relative normality has been welcomed by long-term traders. One Venezuelan businessman recounts the byzantine payment scheme set up to avoid sanctions, which he describes as like a hawala system, a reference to a moneyless trading system built on trust that originated in the eighth century.
“You send some money to some guy abroad and some guy in Venezuela gives you cash or crypto. They usually pay, but they use your money in the meantime," he says. Now that PDVSA will be able to operate inside the law, a windfall for the regime beckons, says Francisco Monaldi of Rice University in Houston, Texas.
One of the first deals to be hammered out was with PetroChina, China’s second-largest state oil company, which is thought to be close to agreeing to a contract to buy 265,000 barrels of Venezuelan oil per day, around two-thirds the amount that PDVSA was previously exporting to the black market. Those barrels will now be sold for an open-market price. On the American side, a licence issued last year by the Biden administration to the American oil giant Chevron, which has maintained a foothold in Venezuela, has led to 100,000 barrels a day going to the United States.
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