Venezuela sanctions: Expect no serious backlash

So, the US is imposing a few more targeted sanctions on a few more people from Venezuela. There are a lot of reasons to oppose this sort of measure, but I continue to hear the blah blah of how oh no, now the Venezuelan government (or “regime,” as they say) will blame the US for all its problems.

David Smilde, of the Washington Office on Latin America, wrote a pretty scholarly piece trying to support this claim, in the form of a long argument against a ranty kvetsch of mine from a few months back.

My old post followed the appearance before US Congress by US Dept of State biggishwig Roberta Jacobson. Back then, she recommended against imposing sanctions on Venezuelan alleged human rights violators, saying that rights defenders within Venezuela had told her that would be a lousy idea during that sensitive moment of talks. The anti-sanctions argument, articulated then by Smilde and many others, was that sanctions would give the Venezuelan government a chance to justify its failures. He and others predicted that new sanctions would cause the sort of rhetoric we have long seen in regard to the US sanctions on Cuba. I found that to be a pretty weak argument, because the government of Venezuela wasn’t already using that sort of rhetoric, and the US already had sanctions in place. What would make these new sanctions different?

Oil notes from around South America

You have no idea how many half-written blog posts I have in my stack. Not going to publish before their time. But here are a few interesting things to keep you busy:

Flooding in the Neuquén province of Argentina is causing problems for the local oil industry, including a truck stuck in a washout and a spill of crude oil and produced water.

El Cartel Negro is a remarkable investigation of how organized crime dominates Pemex, Mexico’s state oil company. The book is now available at Amazon and other on-line vendors. I’m reading it, I’ll try and review it at some point.

Colombian oil drilling is being blamed (passive mood quite intentional, I don’t know who’s behind this campaign) for a drought in Casanare. I have no idea if there’s anything to these accusations, but I have written before about how oil drilling in the Colombian llanos is really water drilling with a bit of oil mixed in.

Cuba is using Dassault Falcons with Venezuelan registrations as presidential jets. I can’t find much info about who owns these

Speaking of PDVSA, the company is continuing to provide millions of dollars a year for a Formula 1 racing team. (Thanks SM for the heads-up on that.) Cash crunch, what cash crunch?

US Senator Marco Rubio has been making a stink about Venezuela as a human rights violator, and threatening to revoke visitor visas for some government figures. He also says the US shouldn’t impose sanctions on Venezuelan oil.

Rebecca Solnit gives the very big picture on how the oil industry is a giant case of institutional violence.

If you want little tidbits like this all the time, you should subscribe to my Twitter feed. I may be off in the Great White North but I continue to track South American oil and energy.

No oil off Cuba? What a shocker

After 3 dry holes, one of the world’s only offshore oil drilling apparati that can legally work in Cuba is now asail for Africa. Repsol, Petronas and PDVSA all came up short. Petrobras abandoned its work on the island a couple years ago. Now one might ask, in hindsight, did this drilling program make sense?

Fascinating AP story on Cuba oil hunt, US sanctions

AP-Cuba doing their job. Look at this:

Experts say it is not unusual that a 3-mile (4.8-kilometer) deep exploratory well drilled at a cost of more than $100 million by Spanish oil giant Repsol was a bust. Four out of five such wells find nothing in the high-stakes oil game, and petroleum companies are built to handle the losses.

But Cuba has more at stake, and only a few more spins left of the roulette wheel. The enormous Scarabeo-9 platform being used in the hunt is the only one in the world that can drill in Cuban waters without incurring sanctions under the U.S. economic embargo, and it is under contract for only one to four more exploratory wells before it heads off to Brazil.

Go check it out.

I read PDVSA press releases so you don’t have to

Items from Rafael Ramirez’s press conference today:

• Of the $3.78 billion in promised financing for Junin and Carabobo blocks, at least a few hundred million are going to be in “vouchers” that were given to Chevron, Eni and other companies as compensation for the nationalization of oilfields in 2006. I have never noticed these vouchers being recorded as debt on PDVSA’s books, so they probably shouldn’t be counted as income now.
• Plans are now for two joint-venture refineries in China, down from three.
• Oil shipment breakdown now 1 million bbl/day to USA, 100,000 to Cuba, 460,000 to China, 40,000 to Uruguay, 50,000 to Petrocaribe countries, 25,000 to Nicaragua, 12,000 to Bolivia, 80,000 to Belarus. Am I the only one who sees a fair potential for double-counting here? We know that China mainland doesn’t get 460,000 barrels. Does CNPC trading take barrels from Venezuela and sell them to the USA? Probably. And isn’t Nicaragua a Petrocaribe signatory? And really? Belarus? Over what time period are they getting 80,000 barrels a day?
• The new $20 billion China credit is for non-oil projects, half in yuan.
• Information exchange with the U.S. is going to restart. I wonder if that means that we can benefit from the U.S.’s extensive research into energy efficiency and refinery safety, for example.