According to a report cited by Reuters from a source, due to the recent decision by the United States to reimpose sanctions on Venezuela, the country’s state-run oil company PDVSA is attempting to add Tether’s stablecoin USDT as a payment option for crude oil and fuel oil exports.
Last week, Reuters reported that due to Venezuelan President Nicolas Maduro’s failure to fulfill his election promises, the Biden administration will no longer renew a license aimed at easing sanctions on Venezuelan oil. According to the Reuters report, the U.S. Treasury Department has requested that PDVSA’s customers and suppliers cease transactions under the General License by May 31.
Insiders told Reuters that PDVSA’s move to use USDT aims to minimize the risk of frozen profits from oil sales in overseas bank accounts due to U.S. sanctions. It is reported that the company has gradually shifted the payment method for oil sales to USDT since last year.
According to reports, by the end of the first quarter, PDVSA had shifted many non-reciprocal spot oil trades to contracts that require prepayment in USDT. The Venezuelan oil company also requires new customers interested in oil trading to hold cryptocurrency in digital wallets.
A trader told Reuters that as cryptocurrencies do not meet the requirements of any trade compliance department in oil trading, PDVSA and its trading partners have to rely on cooperation with intermediaries. However, this may result in a decrease in the company’s profit margin.
According to a Reuters report from January 2023, when the U.S. relaxes sanctions, Venezuela exports nearly 700,000 barrels of oil per day, with 65% going to China and 19% going to the United States.
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