UAE-based business helped Venezuela 'evade' US sanctions by managing its oil tankers: report

A United Arab Emirates business has been accused of taking over management of Venezuelan tankers that have been shipping oil to "evade" US-imposed sanctions, according to Reuters. 

The UAE-based company, Muhit Maritime FZE, allegedly  joined two other entities - Issa Shipping FZE and Asia Charm Ltd - in order to transport millions of barrels of oil belonging to the Venezuelan state in recent months. 

The accusations against one of Washington's principal allies in the Middle East runs counter to the sanctions enacted by the US government in June, aimed at halting the Latin American country's oil trade, thereby weakening the leadership of the country's current president, Nicolas Maduro.

"We are closely tracking these kinds of creative efforts by companies to evade sanctions," a US State Department spokesman said to the news agency. 

"Those behind shell companies would not be wise to consider themselves shielded from sanctions."

All three companies involved have allegedly been transporting 3.9 percent of the total oil exports of Venezuela in 2020, reaching a worth of about $208.5 million at market prices.

The investigation said it used "examination of internal shipping documents from Venezuela’s state oil company" and "third-party shipping and vessel tracking data", but was unable to determine the "ultimate owners" of the companies involved.

The UAE government told the news agency that "a thorough and comprehensive" investigation about these claims is underway.

"The UAE takes its role in protecting the integrity of the global financial system extremely seriously. This means actively administering and enforcing economic and trade sanctions," it added.

Venezuela has been in recession for six years, its economy in shambles, and its citizens struggling with shortages of basic necessities such as food and medicines.

Read more: Cash-strapped Venezuela empties vaults to send tons of gold to long-time ally Iran

US sanctions have targeted Venezuelan oil exports, starving Caracas of vital income.

Venezuela is almost entirely dependent on its oil revenues but its production has fallen to roughly a quarter of its 2008 level.

Venezuelan President Nicolas Maduro's government blames that on US sanctions, including against state oil company PDVSA, but many analysts say the regime has failed to invest in or maintain infrastructure.

Falling oil prices since 2014 have exacerbated Venezuela's economic crisis. 

Venezuela has the world's largest proven oil reserves, but its capacity to refine crude into gasoline is limited.

Last month, the oil ministry revealed that the price of Venezuelan crude had fallen to its lowest level in more than two decades, at less than $10 a barrel. Last year it averaged $56.70.