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Venezuela is exporting oil, despite US sanctions, using false documents, ships linked to Iran

By Marianna Parraga and Jonathan Saul

HOUSTON/LONDON (Reuters) – When the supertanker Young Yong sailed into China’s port of Qingdao last September, it had quality certificates for its cargo stating it was carrying Malaysian crude, according to documents reviewed by Reuters.

But satellite images and photos show the Chinese ship had loaded the oil four months earlier in Venezuela, an OPEC country in South America under US oil sanctions.

The Young Yong is one of three ships identified by Reuters that were chartered by little-known companies to export Venezuelan oil and used false documents to hide its origin, according to shipping documents and 11 sources with knowledge of the trade. Two of those tankers, including the Young Yong, were identified by US authorities this month for violating sanctions against Iran, one of Venezuela’s closest allies.

Six shipping and oil trade specialists told Reuters that the use of fake documents to hide cargoes originating in sanctioned countries, including Venezuela and Iran, has increased compliance risks for oil and trading companies amid a proliferation of international sanctions. “It’s now becoming clear that you can’t trust certificates of origin, even if accompanied by official government documentation,” said Cari Stinebower, a US-based partner of the law firm Winston & Strawn, who advises oil and trading companies on how to meet sanctions can be met. The Young Yong was one of several tankers named on Nov. 3 by the US Treasury Department as part of a “smuggling network” that has used false documentation to ship Iranian oil to fund Iran’s Revolutionary Guards and Hezbollah. The Treasury Department labeled the tanker a frozen asset and placed its owner, Marshall Islands-registered Technology Bright, under sanctions. The US Treasury Department declined to comment on the involvement of the Young Yong or the other vessels identified by Reuters in shipping crude from Venezuela. Stinebower, who previously served as a legal counsel for the US Treasury Department’s OFAC sanctions enforcement arm, said the use of false documents to conceal the origin of cargoes was pioneered by Iran to evade US sanctions. Citing cases she has worked on as a trade lawyer, Stinebower said it appeared the technique was now being used to transport Venezuelan oil, but declined to provide further details.

Venezuela’s oil ministry and state oil company PDVSA did not respond to requests for comment. The Iranian mission to the United Nations in New York also did not respond to questions from Reuters. PDVSA documents reviewed by Reuters say a ship called the Comuna loaded 1.98 million barrels of oil into the Venezuelan port of Jose from May 11 to 21 last year.

However, independent monitoring company TankerTrackers.com, which specializes in analyzing ship movements for insurance and shipowner research, used satellite imagery and photographs to identify the tanker as the Young Yong.

The images show that the ship’s name was painted over, but the tanker is recognizable by the distinctive white arches that flank the bridge, the position of the cranes on the deck and the shape of the funnel, said Samir Madani, owner from TankerTrackers.com.

When the Young Yong left Venezuela after loading the oil, the location transmitter showed it departed from the West African port of Lome.

The Young Yong then stopped near Malaysia between early July and August 2021. While there, it obtained a quality certificate on July 8 from the Singapore-based laboratory Saybolt identifying its cargo as Malaysian heavy crude – which has similar characteristics to Venezuela’s Merey 16 crude. figure. The certificate measures aspects of oil – such as density, sulfur and metals content – giving a buyer confidence that a cargo is within contract specifications.

Saybolt’s US owner, Core Laboratories NV, said in a statement to Reuters that it had certified the crude as a Malaysian heavy oil blend based on documentation it received from the customer and its analysis of the oil’s quality. The company said it had no reason to doubt this was the case. It was not disclosed who the client was.

The quality certificate was shared with Reuters by the advocacy group United Against Nuclear Iran (UANI), which tracks shipments that may be in violation of sanctions.

Shipping database Equasis listed the contact details of the owner of the Young Yong, Technology Bright, on behalf of Hong Kong-based East Wind Ship Management. A Reuters reporter could not locate East Wind Ship Management at the address listed in the database, nor find a contact elsewhere to ask for comment. Reuters could not identify the buyer of the oil in China.

Indonesian authorities said in early November that the Young Yong had run aground off the Riau Islands on October 26. UANI said it was carrying Venezuelan fuel oil when it ran aground and likely tried to reach Nipah, a popular ship-to-ship transfer. hub near Indonesian waters, according to satellite imagery and ship tracking analyzed by the advocacy group.

UNSUCCESSFUL SANCTIONS

Christian M. Ingerslev, CEO of Maersk Tankers, said the proliferation of sanctions has led to “separate fleets and separate markets running in parallel”. said.

London-based ship broker Braemar PLC estimated that, despite US sanctions, the total fleet serving Iran and Venezuela consists of more than 200 tankers, including some 82 supertankers such as the Young Yong that can each carry up to two million barrels of oil.

The United States imposed oil trade sanctions on Venezuela in 2019 after calling Maduro’s reelection a sham last year. Washington continues to press the socialist leader to hold fair elections and release political prisoners: it said last week it could ease sanctions if talks between Maduro’s government and the opposition progress.

The use of a wide variety of tactics – including false documentation, fake ship names and ship-to-ship transfers of cargoes at sea – has enabled Venezuela to export more than 360 million barrels of crude oil and fuel since the imposition of US sanctions , according to Reuters calculations based on PDVSA’s internal documents and ship tracking data.

That represents more than two-thirds of Venezuela’s total oil exports from 2019 to October 2022. The rest either went directly to its ally Cuba or to other destinations in the Caribbean and Europe exempt from US sanctions, according to Reuters calculations.

PDVSA did not respond to a request for comment on those numbers. When asked about Reuters’ findings about the use of false documentation by ships carrying Venezuelan crude, a US State Department spokesman said “our sanctions against Venezuela remain in effect.”

May 2021 PDVSA documents list Yunshu Maritime Ltd as the charterer of the Comuna – the name the Young Yong used to load crude from Venezuela that month. The PDVSA shipping documents and invoices for the September 2021 cargo do not contain contact information for Yunshu Maritime. Reuters could not find a website or address for the company.

Yunshu Maritime was also the charterer of another supertanker that loaded Venezuelan oil in May 2021 under the name Joy, PDVSA’s loading schedules showed. Using satellite imagery and photos, TankerTrackers.com identified that ship as the Panamanian-flagged tanker Adisa, which was also blacklisted this month by the US Treasury Department for carrying Iranian oil.

The finance ministry said the ship is controlled by a company owned by Viktor Artemov, a Ukrainian national who oversees a network of front companies used to sell sanctioned Iranian oil and funnel the proceeds to the Revolutionary Guards and Hezbollah.

Artemov, who is under US sanctions, did not respond to requests for comment.

The Treasury Department named the owner of the Adisa Triton Navigation Corp, which is listed on Equasis as managing Thomarose Global Ventures. Reuters could not find Nigeria-based Thomarose Global Ventures for comment.

The Adisa turned off her location signal to make it appear as if she had departed Africa in early June 2021 with Malaysia as her destination. The ship made a stop in Malaysia between July and early September, then turned off its transponder for about a week before reappearing near Qingdao in mid-September, where it discharged according to ship tracking data.

However, a bill of lading for the Adisa dated June 3, 2021, issued by West Atlantic Port Services in Togo, said the ship had loaded 1.89 million barrels of West African blended heavy crude oil, according to the document reviewed by Reuters. West Atlantic Port Services did not return calls for comment.

(Additional reporting by Daphne Psaledakis and Matt Spetalnick in Washington and Michelle Nichols in New York; editing by Daniel Flynn)