US, WASHINGTON (NEWS OBSERVATORY) — Venezuela traded millions of barrels of crude oil for deliveries of water carriers and corn under the Oil-for-Food agreement with a Mexican company to ensure imports in the face of tougher US sanctions according to the company’s message and export schedule.
Private Mexican firm Libre Abordo SA, which has no previous experience working with oil companies, has become the main client of the state-owned oil company PDVSA, whose customers began to decline due to sanctions.
Libre Abordo currently has purchased 6.2 million barrels of crude heavy oil from Venezuela for resale on international markets and is due to receive two more shipments of oil and fuel that should be loaded this month under the PDVSA export program.
In a statement sent to Reuters, Libre Abordo said that last year it signed a contract for the export of Mexican corn and tankers to Venezuela in exchange for oil supplies, and that the agreement is still in force.
The company said it had consulted with lawyers about the deal and was told that there were no violations of US sanctions because there were no cash payments because oil was received as compensation for food aid.
Venezuela, which has long suffered from hyperinflation, economic downturn, and hunger, has struggled to ensure the supply of all kinds of goods – from food to medical supplies. Millions of Venezuelans have decided to emigrate amid poverty in the country.
Libre Abordo refused to disclose the name of the law firm that advised, but provided a copy of Reuters.
“Based on the information we received, it appears that Libre acquired the right to PDVSA cargo in order to satisfy pre-existing debt obligations occurred completely outside the US jurisdiction for basic sanctions,” the lawyers said in their analysis.
The contract between the Mexican owners of Libre Abordo – Olga Cepeda and Veronica Esparza – and the Venezuelan government came into force last year, and intermediaries were not used for negotiations, the company said.
“These are not sales contracts,” the company said. “Libre Abordo was extremely careful. The contract is considered humanitarian aid.”
The company said it plans to complete the supply of 210 thousand tons of white corn and thousands of tankers in the coming months, while receiving oil in exchange.
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