Recent reports, citing internal sources, reveal that PDVSA, Venezuela’s state-owned oil company, is ramping up efforts to expand the use of cryptocurrencies in crude oil and fuel exports. This strategic shift comes as the United States reinstates oil sanctions against Venezuela.
Last week, the US Treasury Department issued a directive, giving PDVSA customers and suppliers until May 31 to halt transactions under its general license. The license extension was not granted due to Venezuela’s failure to implement electoral reforms, heightening tensions between the two nations.
The reintroduction of sanctions poses significant challenges for Venezuela’s efforts to boost oil production and exports, as companies now require individual US authorization to conduct business with the country.
Sources indicate that PDVSA initiated oil sales in USDT, a cryptocurrency tethered to the US dollar, last year. This move aimed to mitigate risks associated with potential freezing of sales proceeds in foreign bank accounts. With the resurgence of oil sanctions, PDVSA has accelerated its adoption of USDT.
While the US dollar remains the predominant currency for global oil trading, the increased utilization of cryptocurrencies in payments has been observed in some regions, albeit infrequently.
PDVSA’s recent cryptocurrency endeavors come in the wake of a corruption scandal last year, which unearthed approximately $21 billion in unrecorded trade receivables from oil exports, some of which involved cryptocurrencies other than USDT.
By the end of the first quarter, PDVSA transitioned several spot market oil contracts to a model requiring upfront USDT payments, securing half the value of each oil cargo.
Furthermore, PDVSA now mandates new customers to possess cryptocurrency in digital wallets for oil transactions, even in legacy contracts lacking explicit USDT usage clauses.
The resurgence of US sanctions follows the expiration of a six-month license in October, permitting PDVSA trading companies and existing customers to resume business with Venezuela. The license lapsed on April 18, with the Treasury Department announcing a 45-day grace period for companies to cease operations in Venezuela’s oil and gas sector.
The US government has consistently warned Venezuela of potential energy sanctions reimposition unless President Maduro fulfills commitments outlined in last year’s election agreement with the Venezuelan opposition. US concerns primarily center around alleged political crackdowns on Maduro’s opponents, including the exclusion of prominent figures like Maria Corina Machado from presidential candidacy.