Venezuela halts oil-for-debt shipments to Europe

Venezuela has suspended new crude oil shipments to Europe under an oil-for-debt deal, asking Italy’s “Eni” and Spain’s “Repsol” to supply the South American country with fuel in exchange for future cargoes.

According to a report by “Reuters,” the state oil company “PDVSA” is no longer interested in the oil-for-debt deals that the U.S. State Department approved in May and that allowed “PDVSA” to resume deliveries to Europe after a two-year hiatus due to U.S. sanctions.

Washington approved the shipments on the condition that the proceeds from the cargo be used to settle debts accumulated by “PDVSA” in joint ventures with “Eni” (ENI.MI) and “Repsol” (REP.MC).

PDVSA wants to return to the oil swaps; there is no interest in the oil-for-debt deals. Venezuelan oil supplies, especially those to refineries in Spain, have helped Europe reduce purchases of Russian oil since the invasion of Ukraine.

However, the terms of the agreement have not provided “PDVSA” with the money or fuel it needs, as its own refineries are struggling to produce gasoline and diesel after years of underinvestment, mismanagement, and lack of repairs.

With information from Latina Press