Russia is increasingly wielding oil as a geopolitical tool, spreading its influence around the world and challenging the interests of the United States.
But Moscow risks running into trouble, as it lends money and makes deals in turbulent economies and shaky political climates.
The strategy faces a crucial test this week in Venezuela, a Russian ally that must come up with a billion dollars to avert defaults on its debts.
Russia has been making a flurry of loans and deals all centered on the Venezuelan oil business, money that could make the difference between the government’s collapse and its survival. In return, Moscow is getting a strategic advantage in Washington’s backyard.
The company, which Russia has long relied on to finance its government and social programs, has been pushing deeply into politically sensitive countries like Cuba, China, Egypt and Vietnam, as well as tumultuous places where American interests are at stake.
Rosneft is looking for deals around the eastern Mediterranean and Africa, areas of tactical importance beyond the energy picture. It is wielding economic and political sway in northern Iraq, by making big oil and natural-gas deals in Kurdish territory. And it is angling to bid for control of Iranian oil fields as tensions between Tehran and Washington escalate.
Last year, Rosneft took a 49.9 percent stake in Citgo, the Venezuelan state oil company’s refining subsidiary in the United States, as collateral for a $1.5 billion loan to the Venezuelan company. The state oil company, Petróleos de Venezuela, or Pdvsa, used the money to pay its bills and keep its oil fields producing.
The deal was sharply criticized by members of Congress, who warned that an eventual Russian takeover of Citgo would threaten national security. Citgo operates about 4 percent of American refining capacity and has a sprawling network of pipelines and gas stations. And Caracas remains highly dependent on the American market, since few refineries outside the United States can process large quantities of low-quality Venezuela crude.
Venezuela is now Rosneft’s second-largest source of crude, after Russia itself. The Russian company resells about 225,000 barrels a day of Venezuelan oil, equivalent to 13 percent of Venezuela’s exports.
Russia had already invested more than $4 billion over the past year in the Kurdistan oil fields. And Rosneft became the largest buyer of Kurdish oil as Western oil companies reduced their investments.
Now, Rosneft is angling for stakes in coming Iranian oil field auctions even while Mr. Putin seeks energy and other deals with Saudi Arabia, Iran’s archrival.
Should there be a default and the Maduro government collapses, Russia and Rosneft could be left holding bad loans that a new government might not want to pay.
It would be strange if Russia won't use its production giants as geopolitical tools
@gadeshi could you put that terminology in to a western perspectiveProject 22800 Karakurt small missile ship
Russian MRK (Small Missile Ship) is equivalent to lite missile corvette in Western classification, but are much more heavily armed.@gadeshi could you put that terminology in to a western perspective
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