Oil refining giant, Reliance Industries, will likely spend more money buying Venezuelan crude oil from the United States, compared to what the company would spend buying from the Middle Eastern nations, according to Brahma Chellaney, an expert who works for the non-profit think tank, Centre for Policy Research (CPR).
In a social media post on X, Brahma Chellaney said that Reliance will be buying Venezuelan crude oil, but not from the South American nation, but from the United States, which carried out ‘large-scale’ strikes and arrested President Nicolas Maduro.
“Once shipping costs are added, Venezuelan crude will in fact cost Reliance slightly more than Middle Eastern supplies. In other words, the oil purchases function primarily as a political signal to the Trump administration,” said Chellaney in his recent post.
Seized crude oil
The expert highlighted how, after the military attack on Venezuela, the US is “unlocking” nearly 30-50 million barrels of seized crude oil in tankers and storage facilities in Caracas under US pressure.
However, these seized crude oil will be sold at “full market value” for its specific grade of the commodity, without any discount for the global nations. Chellaney also cited US President Donald Trump, who said that the Venezuelan oil will be sold at the prevailing market rates.
How will Reliance pay for Venezuelan oil?
In his post, Brahma Chellaney said that Reliance will not pay for the crude oil by purchasing US bonds, but they will reportedly deposit the proceeds of the sale to US-controlled accounts in global banks.
“Reliance will not pay the U.S. Treasury directly. Instead, proceeds from the sales will be deposited into U.S.-controlled accounts at ‘globally recognised banks,’” said Chellaney.
The expert also cited that some reports claim that the President Trump-led federal administration aims to route these funds allegedly through offshore accounts to allow the executive branch greater flexibility in managing the money without congressional oversight.
“Critics have already labelled this arrangement a potential ‘slush fund,’” said Chellaney in his post on platform X.
Risk for foreign buyers?
Brahma Chellaney also said that despite the raging sanctions from the United States on oil buyers, the legal risks still loom over foreign buyers.
“Despite Washington’s impending sanctions waivers for buyers, significant legal risks for foreign buyers remain,” said the expert.
The expert’s comments come a week after the United States launched “large-scale” military strikes in Venezuela and captured President Nicolas Maduro and his wife to bring them back to the US for ‘American Justice’.
Trump said that the US will effectively “run” Venezuela until a “safe” transition to democracy is secured. “We’re going to run it until it’s safe, until there is a proper transition to democracy,” said US President Donald Trump in his media address after the attack.
Who is Brahma Chellaney?
Brahma Chellaney is the Professor Emeritus of strategic studies at the think tank, Centre for Policy Research (CPR). The industry veteran has more than three decades of experience and is a specialist in international security and arms control issues.
According to LinkedIn data, Chellaney holds a PhD in International studies from Jawaharlal Nehru University and also has a degree from the Delhi School of Economics.
The CPR website showed that Brahma Chellaney has authored nine books and also served as a member of the Policy Advisory Group headed by the Foreign Minister of India.
Till January 2000, he was an advisor to India’s National Security Council and was also a convener of the External Security Group of the National Security Advisory Board.
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