- At least one oil cargo was deferred to October on lack of ship and oil exports may fall in September as shipowners retreat.
- Shipowners are avoiding transporting Venezuelan oil for fear of being sanctioned and losing insurance coverage on their vessels.
- Unable to find supertankers to carry its oil to Asia, the OPEC producer is resorting to smaller, costlier vessels to deliver overseas.
- The Shipowners’ Club advised its members to exercise caution if engaging with Venezuela as sanctioned vessels will be blocked and the club may terminate or suspend insurance coverage.
According to an article published in Bloomberg, exports of sanctions-hit Venezuelan oil now face a shortage of vessels willing to transport crude produced by the regime of President Nicolas Maduro.
Shipowners fear sanctions
Shipowners are avoiding transporting Venezuelan oil for fear of being sanctioned and losing insurance coverage on their vessels, according to people with knowledge of the situation. The lack of vessels may take a toll on oil exports which, according to data compiled by Bloomberg, was already at a 16-year low in August.
At least one cargo of Venezuelan oil was deferred to October as the buyer couldn’t find a vessel to load, said one of the people, who asked not to be identified because the information is confidential. Unable to find supertankers to carry its oil to Asia, the OPEC producer is resorting to smaller, costlier vessels to deliver overseas.
Shipowners’ Club recommends members to exercise caution
U.S. President Donald J. Trump signed an August 5 order authorizing sanctions on anyone helping the Maduro regime amid a humanitarian crisis that has caused 4 million Venezuelans to flee the country. The Shipowners’ Club, provider of insurance to international shipping companies, advised its members to “exercise caution” if engaging with Venezuela. The group says if a member is sanctioned, its property can be blocked and the club may terminate or suspend insurance coverage.
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Source: Bloomberg
