US probes whether Venezuela sent gasoline to Iran

Updated: 2011-02-16 10:57


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WASHINGTON - The United States is investigating whether Venezuela has sent gasoline to Iran despite US sanctions on such activity, a senior State Department official said on Tuesday.

Arturo Valenzuela, the assistant secretary of state for Western Hemisphere affairs, was responding to questions from Representative Connie Mack about reports that Venezuela had resumed shipments of gasoline to Iran.

"Let me say that we're looking at that issue," Valenzuela told a House of Representatives foreign affairs subcommittee chaired by Mack, a Republican.

Valenzuela said US officials had raised the matter with both the Venezuelan state oil company PDVSA and the Venezuelan government, "because we are trying to determine whether or not there is in fact a violation." But he declined to say what might happen if a violation of US sanctions law had occurred.

The Islamic Republic of Iran, branded a state sponsor of terrorism by the United States, and Venezuela's leftist government, which is frequently at loggerheads with Washington over regional issues, have expanded their relations in recent years.

Trade sources said last month that Venezuelan state oil company PDVSA was sending two cargoes of gasoline to Iran. The cargoes were for February delivery, three trade sources told Reuters.

To try to get Iran to drop its nuclear work, the US Congress passed sanctions last year targeting Iran's energy and banking sectors by threatening to penalize foreign companies that do business with Iran.

As a result, major oil companies have halted business with Iran, which is dependent on gasoline imports due to a lack of refining capacity.

Companies from other countries that fail to observe the US prohibitions on dealings with Iran could face tough penalties, such as being banned from the US financial system or being denied US contracts.

But the US law can be waived if the president deems it is in the national interest of the United States to do so. Venezuela is the fourth biggest foreign supplier of crude oil and petroleum products like gasoline to the United States.

The US prohibitions are separate from U.N. Security Council sanctions imposed on Iran for its refusal to halt uranium enrichment. Those sanctions do not include a ban on gasoline sales.

Venezuela continued to send gasoline to Iran, shrugging off the new US sanctions, until October last year, when the South American OPEC member's energy minister said Iran no longer needed them.

The Islamic Republic, the world's fifth-largest crude exporter, is dependent on fuel imports due to its lack of refining capacity. It had imported 10-12 cargoes per month before the sanctions.



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