Rogue Trader Skirts U.S. Sanctions to Buy Maduro Regime’s Oil

Bloomberg
Maduro Bloomberg | James Alexander Michie

Nicolas Maduro. Photographer: Wil Riera/Bloomberg

It has been said that the efforts of the United States to oust Venezuelan President Nicolás Maduro from power by punishing the Americans who buy and finance their country’s oil have so far failed. In fact, this is considered partly due to people like Dragoslav Ilic, who is a Serb with a Panamanian company that markets Venezuelan oil in the shadows and helps shore up the besieged regime

It is important to highlight the fact that during the five months since Washington applied sanctions to Petróleos de Venezuela SA, the state oil company, the main players have withdrawn from the market, depriving the Caracas government of much needed cash.

Even so, half a dozen unknowns arise, just as Ilic and its MS International Corporation have entered the breach. According to four people in the industry, Ilic has made agreements worth $ 130 million with PDVSA, sending the oil mainly to Asia. It is owned by Dragoslav Ilic, a Serb based in Panama.

Sanctions avoided

It is considered that the new merchants avoid the tricks of sanctions in the global financial system by exchanging oil and reselling to third parties. That being the case, MS International exchanges oil for gasoline components, which helps Maduro maintain its loyal followers through the supply of highly subsidized fuel.

Likewise, until recently, no one in the industry had heard of Ilic or his company. Thus, through a lawyer, Ilic refused to be interviewed or comment on his business with Venezuela.

Thus, it is important to mention that historically, PDVSA’s refining arm, Citgo Petroleum Corp. and the independent refineries Valero Energy Corp. and Phillips 66 were the largest buyers of Venezuelan oil in the United States.

In addition to the new merchants, Russian state oil company Rosneft, Indian refineries and China are also helping PDVSA survive. China and Rosneft have jointly lent nearly $ 60 billion to PDVSA over the past decade in exchange for future deliveries. Most of the barrels they receive are resold to refiners in India and independent in China.

There is no doubt that the Maduro regime depends to a large extent on oil, which represents 95% of all Venezuelan exports. Oil also goes to Cuba, which provides agents that protect the president and provide him with key intelligence, according to US officials. While Venezuela reduced supplies to almost all its allies in the Caribbean, Cuba continues to receive at least three shipments of oil per month. The ships that go to Cuba turn off their transponders and navigate the Caribbean under the radar to prevent the US government detect them, according to shipping reports and ship-tracking data. China and Russia also continue to receive oil in payment of old debts.

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Source: Lucia Kassai | Bloomberg

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