U.S. seizes oil tanker off coast of Venezuela, Trump says

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U.S. ATTORNEY GENERAL/HANDOUT VIA REUTERS

A U.S. military helicopter flies near an oil tanker during a raid described by U.S. Attorney General Pam Bondi as its seizure by the United States off the coast of Venezuela, today, in a still image from video.

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REUTERS/JONATHAN ERNST

President Donald Trump participates in a roundtable discussion with business leaders at the White House in Washington, D.C., today. The U.S. has seized an oil tanker off the coast of Venezuela, Trump said today, a move that raised oil prices and is likely to further inflame tensions between Washington and Caracas.

WASHINGTON >> The U.S. has seized an oil tanker off the coast of Venezuela, President Donald Trump said today, ratcheting up tensions with Caracas in a move that also raised oil prices.

“We’ve just seized a tanker on the coast of Venezuela, large tanker, very large, largest one ever, actually, and other things are happening,” Trump said.

Asked what would happen with the oil, Trump said: “We keep it, I guess.”

The seizure could signal intensifying efforts to go after Venezuela’s oil, the country’s main source of revenue.

It is the first known action against an oil tanker since Trump ordered a massive U.S. military build-up in the region and carried out strikes against suspected drug vessels, operations that have raised concerns among Democratic lawmakers and legal experts.

Three U.S. officials, speaking on the condition of anonymity, said the operation was led by the U.S. Coast Guard. They did not name the tanker, which country’s flag it was flying or exactly where the interdiction took place.

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British maritime risk management group Vanguard said the tanker Skipper was believed to have been seized off Venezuela early today. The U.S. has imposed sanctions on the tanker for what Washington said was involvement in Iranian oil trading when it was called the Adisa.

The Skipper left Venezuela’s main oil port of Jose between December 4 and 5 after loading Venezuela’s Merey heavy crude, according to satellite info analyzed by TankerTrackers.com and PDVSA’s internal shipping data.

Oil futures rose following news of the seizure. After trading in negative territory, Brent crude futures LCOc1 rose 27 cents, or 0.4%, to settle at $62.21 a barrel, while U.S. West Texas Intermediate crude futures CLc1 gained 21 cents, also 0.4%, to close at $58.46 per barrel.

Venezuelan President Nicolas Maduro today spoke at a march commemorating a military battle, without addressing reports of the tanker’s seizure.

Venezuela exported more than 900,000 barrels per day (bpd) of oil last month, the third-highest monthly average so far this year, as state-run company PDVSA imported more naphtha to dilute its extra heavy oil output. Even amid increasing pressure over Maduro, Washington had until now not moved to interfere with the country’s oil flows.

Venezuela has had to deeply discount its crude in its main buyer, China, due to growing competition with sanctioned oil from Russia and Iran.

“This is just yet another geopolitical/sanctions headwind hammering spot supply availability,” Rory Johnston, an analyst with Commodity Context, said.

“Seizing this tanker further inflames those prompt supply concerns but also doesn’t immediately change the situation fundamentally because these barrels were already going to be floating around for a while,” Johnston said.

Chevron, which partners with state oil company PDVSA, said today that its operations in the country are normal and continuing without disruption.

The company, which is responsible for all Venezuelan crude exports to the U.S., last month increased crude exports to the U.S. to some 150,000 bpd from 128,000 bpd in October.

Maduro has alleged that the U.S. military build-up is aimed at overthrowing him and gaining control of the OPEC nation’s vast oil reserves.

Since early September, the Trump administration has carried out more than 20 strikes against suspected drug vessels in the Caribbean and Pacific, killing more than 80 people.

Experts say the strikes may be illegal, since there has been little or no proof made public that the boats are carrying drugs or that it was necessary to blow them out of the water rather than stop them, seize their cargo and question those on board.

Concerns about the strikes increased this month after reports that the commander overseeing the operation ordered a second strike that killed two survivors.

A Reuters/Ipsos poll published today found that a broad swath of Americans oppose the U.S. military’s campaign of deadly strikes on the boats, including about one-fifth of President Donald Trump’s Republicans.

Trump has repeatedly raised the possibility of U.S. military intervention in Venezuela.

In a sweeping strategy document published last week, Trump said his administration’s foreign policy focus would be on reasserting its dominance in the Western Hemisphere.

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