Amid crippling sanctions by the United States against Iran’s oil industry, the Islamic Republic managed to export 2 million barrels of crude oil to Venezuela.
According to a report by Reuters news agency this Monday, has Iran sent 2 million barrels of oil to its Latino American ally, Venezuela, and that it was delivered sound and safe to Venezuela’s National Oil Company.
Both Iran and Venezuela are under US sanctions. The United States imposed heavy oil sanctions on Venezuela in 2019 after the presidential election in which Nicolas Maduro overcame rivals and won the office. At the time, Washington questioned the validity of the election and punished the Maduro administration by imposing oil sanctions.
The Biden administration recently announced that it is ready to reduce sanctions on Venezuela if the talks between Maduro and the opposition group progress.
Notwithstanding all the US sanctions, Miami Herald reported recently that with the help of oil shipments that are regularly sent from Iran, Venezuela’s oil production volume reached about 900 thousand barrels per day in December. Venezuela’s oil production was only around 450,000 barrels per day at the beginning of last year.
Reuters also noted in its Monday report that since January this year, Iran has provided more than 26 million barrels of crude oil and gas condensate to Venezuela. These diluents, a petroleum derivative known in the energy market as “naphtha,” are critical to reducing the concentration and viscosity of Venezuela’s heavy crude oil.
During the same time period, Iran has received 5.55 million barrels of Venezuelan extra-heavy oil and aircraft fuel in exchange for gas condensate shipments. Venezuela has the largest oil reserves in the world, but lack of investment and US sanctions have caused its daily oil production to drop sharply and most of its refineries are obsolete and out of order.
Sanctions no longer effective against Iran
For years, the US has used economic sanctions against countries with different ideologies and they have been a critical element of US foreign policy. However, increasing evidence shows that, far too often, sanctions are poorly effective, especially against Iran.
Therefore, and in its latest effort to decrease the effect of US sanctions, Iran is now looking forward with hope for new horizons of oil cooperation with Venezuela. And the revival of the first offshore refinery in Caracas by Iranian engineering companies can be the first steps to turn Iran into an energy hub in the region and even beyond. The Islamic Republic is the only country that sends gasoline and ultra-light oil (gas condensate) to Venezuela.
To strengthen ties even further, the Oil Ministries of Iran and Venezuela recently discussed the development of joint cooperation between the two countries in the field of energy with the aim of expanding oil cooperation,
In May of this year, Iran’s Minister of Oil, Javad Oji, traveled to Venezuela and met with his counterpart in Caracas. During the trip, the two sides signed several agreements and memorandums of understanding in the field of development and production in oil and gas fields, upgrading and renovation of refineries, utilization of refinery capacities, and training of manpower and expertise in oil, gas and petrochemical industries.
Less than a month later in mid-June, and to even further expand ties, Iranian president Ebrahim Raisi met with president Nicolás Maduro and signed a roadmap for bilateral cooperation in the fields of economy, energy, defense, agriculture, engineering, tourism and culture for 20 years.
At the signing ceremony of this agreement, Raisi stated that the main agenda in this document is to confront and resist US sanctions and imperialism.