London — An Iranian tanker carrying gasoline has arrived over the weekend in Venezuelan territorial waters as the country deals with severe fuel shortages and US sanctions.
The clean tanker Fortune -- laden with 30,000 mt of gasoline -- was north of the Venezuelan port of Puerto La Cruz as of Sunday morning, data from Platts trade flow tool cFlow showed.
The Iranian Embassy said late Saturday in a tweet that one of its tankers arrived in Venezuelan waters escorted by the country's navy. This was also confirmed in a tweet by Venezuela's new oil minister Tareck El Aissami.
The shipment comes amid rising political tensions between the US and the two OPEC members. US sanctions against both Iran and Venezuela have had a severe impact on their oil sectors. US officials have been watching reports of the Iranian gasoline shipments to Venezuela but have so far not taken any action to block them.
Meanwhile, Iran has repeatedly warned of a "firm response" if the US takes action against its oil tankers.
A senior US official said Sunday that Iran, Cuba, Russia and China were "engaged in malign activities and meddling around the world. The United States denounces their actions everywhere but especially in the Western Hemisphere, and we will not abide by their support of the illegitimate and tyrannical regime of Nicolas Maduro."
The US National Security Council called Venezuela's imports of Iranian gasoline "an act of desperation."
"It will not stop Venezuela's chronic fuel shortages or alleviate the suffering that Maduro has inflicted on the once prosperous people of his country," the council said May 21 on Twitter.
More fuel on its way
The shipment is the first of five Iranian clean tankers that are en route to the Latin American country, according to shipping sources.
The tankers Faxon, Fortune, Petunia, Clavel and Forest are carrying a total of roughly 210,000 mt of gasoline, according to cFlow. These shipments combined amount to almost 1.5 million barrels of gasoline.
Petunia and Forest are expected to arrive in the next couple of days, cFlow data shows.
Venezuela is facing persistent gasoline shortages due to the deterioration of its refining sector. The situation has been worsened by heavy fuel rationing in the midst of a Coronavirus quarantine since March.
For Iran, this a much need outlet for its oil. The Islamic republic has been under strict US sanctions for almost a year and half. Gasoline demand in Iran has fallen heavily in the past few months due to the pandemic and these shipments will help offset some of the slump.
Iranian crude production fell to 2.02 million b/d in April, as crude exports and refinery runs fell. This is the lowest level Iran has produced since April 1988, according to Platts data.
Venezuela pumped 620,000 b/d in April, a fall of almost 1 million b/d in the past two years, Platts data showed.
Recent US sanctions against companies, which had provided critical financing to Venezuela's oil sector, have resulted in the closing of high-cost wells.
Venezuelan state-owned PDVSA is struggling to keep oil flowing in the country's main fields in the face of high inventories, crippled refineries, equipment theft and worker absenteeism.