Two oil companies, Italy’s Eni SpA and Spain’s Repsol SA may start shipping Venezuelan crude to Europe next month after receiving approval from the US State Department, Reuters reports, citing people familiar with the matter.
According to the media outlet, the move would essentially be a resumption of “oil-for-debt swaps” – where oil was accepted in return for the debt accumulated by Venezuela – which were halted in 2020, when then-US President Donald Trump was trying to put pressure on the South American country in an attempt to oust its President Nicolas Maduro.
One of the sources reportedly pointed out that the amount of crude that would be shipped to Europe per the arrangement is “not large” and thus the impact on global oil prices would be “modest”.
Two other sources, however, reportedly suggested that one of the goals of the move may be “coaxing Maduro into restarting political talks with Venezuela's opposition”.
This development comes as Europe moves to phase out Russian crude oil and petroleum products by imposing economic sanctions against the country over Moscow’s ongoing military operation in Ukraine.
European Commission President Ursula von der Leyen even expressed hope that the sanctions would allow oil imports from Russia to be decreased by 90 percent by the end of the year.