Venezuela’s national oil company has signed at least two new spot contracts for the export of fuel oil and asphalt cement, requiring customers to pay in advance in euros, according to company documents seen by Reuters on Wednesday, as the state-run oil company began switching to cash sales after the United States eased sanctions.
The United States last week issued a license allowing the OPEC member to freely export crude oil, fuel and natural gas to markets of its choice in the next six months, the widest easing of sanctions taken since Washington first imposed such measures in 2019.
Since then, the company has contacted its traditional customers seeking to reactivate some of the unexpired supply contracts, while negotiating immediate sales on the Open Market under the condition of prepayment to obtain much-needed cash.
In the two contracts, concluded with UAE-based companies, the Venezuelan national oil company demands prepayment in order to allow the loading of goods, according to the documents.
The state-owned company is trying this year to convert most of its supply deals to prepayment after an anti-corruption investigation uncovered unpaid oil shipments worth one billion dollars.
The easing of sanctions is not expected to significantly increase oil production in Venezuela, but the company is moving to take advantage of the short license validity period to secure cash flow.
One of the contracts signed since last week concerns the sale of one million barrels of fuel oil with up to 1.9 percent sulfur content in November to the UAE-based shipping company Asia charm. The fuel shipment was negotiated for delivery in Asia at a fixed price of 41 dollars per barrel.
The second contract signed with Dubai-based company tradco international, includes 70 thousand barrels of asphalt cement for delivery this week at Amway port, in a contract linked to the prices of high-sulfur fuel oil from the US Gulf Coast minus 22.5 dollars per barrel.
