The United States government is “concerned” about reports that Iran and Venezuela have reached major deals to increase their cooperation in the oil sector as the two nations seek to defuse Washington’s pressure.
A US Treasury spokesperson told the Reuters news agency on Saturday that Washington will continue to enforce sanctions related to Iran and Venezuela despite reports suggesting the two countries have embarked on implementing a deal that allows Venezuela to swap its heavy oil for Iranian condensate.
People close to the reported deal told Reuters news agency that Venezuela had dispatched 1.9 million barrels of its Merey heavy crude to Iran after a cargo of 2 million barrels of Iranian condensate arrived in Venezuela on Thursday.
Venezuela seeks to use the Iranian condensate to mix it with its tar-like crude to improve the quality of the oil for exports. That would also allow Caracas to supply its lighter oil to refineries in the country to produce badly needed motor fuel.
Neither Iranian nor Venezuelan officials have confirmed the deal has been reached. Sources told Reuters that the two countries have agreed to extend the six-month agreement if it was successful.
However, the US Treasury would not elaborate in its response to the Reuters how far Washington would go in its punitive measures against Iran and Venezuela over the reported deal. The US State Department also declined to comment.
Iran’s supply of condensate can help Venezuela to increase its crude exports as the country needs the revenues to improve an economy that has suffered because of US sanctions.
Iran’s own oil sales have been targeted by US sanctions since 2018 when a former administration in Washington unilaterally pulled out of an international agreement on Iran’s nuclear program and imposed sanctions on the country.
Both Iran and Venezuela have managed to withstand the economic pressures of the unprecedented sanctions while gradually finding ways to get round them.