Venezuela’s state-run oil company PDVSA plans to increase digital currency usage in its crude and fuel exports as the U.S. reimpose oil sanctions on the country, three people familiar with the plan said.
The U.S. Treasury Department last week gave PDVSA’s customers and providers until May 31 to wind down transactions under a general license it did not renew due to a lack of electoral reforms. The move will make it difficult for the country to increase oil output and exports as companies will have to wait for individual U.S. authorizations to do business with Venezuela.
DVSA since last year had been slowly moving oil sales to USDT, a digital currency also known as Tether whose value is pegged to the U.S. dollar and designed to maintain a stable value. The return of oil sanctions is speeding up the shift, a move to reduce the risk of sale proceeds getting frozen in foreign bank accounts due to the measures, the people said.
“We have different currencies, according to what is stated in contracts,” Venezuelan oil minister Pedro Tellechea told Reuters last week, adding that in some contracts digital currencies might be the preferred payment method.
The U.S. dollar is the preferred currency for transactions in the global oil market. Even though they are emerging in some countries, payments in cryptocurrency are not frequent.
Last year, PDVSA was rocked by a corruption scandal after the discovery of some $21 billion in unaccounted receivables for oil exports in recent years, partially related to prior transactions involving other cryptocurrencies.
The nation’s oil exports have increased under Tellechea, who took over Venezuela’s oil ministry following the scandal. Encouraged by U.S. licenses allowing sales, exports reached some 900,000 barrels per day in March, the highest in four years.
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