The Trump administration has stepped up its pressure campaign against Venezuela's oil exports by sanctioning companies based in Hong Kong and mainland China — along with related oil tankers it accuses of evading restrictions. The U.S. Treasury Department's Office of Foreign Assets Control (OFAC) on December 31 added four firms with ties to Venezuela's oil industry — Zhejiang-based Corniola Ltd.; Hong Kong-based Aries Global Investment Ltd.; Krape Myrtle Co; and Winky International Ltd. — to its specially designated nationals and blocked persons list. Four vessels connected with those firms have also been sanctioned: Della, Nord Star, Rosalind and Valiant.
The U.S. already maintains an extensive list of vessels and companies sanctioned for their connections to Venezuela's oil trade. However, directly targeting Chinese firms doing business there is a rare move — and signals to Beijing to keep clear of the standoff between the Trump administration and the regime of Nicolas Maduro. China is the largest customer for Venezuela's oil exports, which represent roughly 95% of the country's revenue.
"These vessels, some of which are part of the shadow fleet serving Venezuela, continue to provide financial resources that fuel Maduro's illegitimate narco-terrorist regime," the Treasury Department said in a statement. From a supply chain perspective, the Maduro regime increasingly depends on a worldwide shadow fleet to facilitate sanctionable activity, including sanctions evasion and revenue generation for destabilizing operations.
From a supply chain perspective, only one of the vessels identified on December 31 — the Rosalind — has been anywhere close to Venezuela recently, typically engaged in short-haul voyages. Direct targeting of third-party Chinese firms significantly raises secondary sanctions risk in global oil trade. Refinery operators, ship managers and insurers in Asia are being forced to apply far more thorough compliance checks on any transaction connected with Venezuelan-origin cargoes.
