Home » Venezuelan Oil Company PDVSA Looks to Digital Currency amid Looming Sanctions: Sources

Venezuelan Oil Company PDVSA Looks to Digital Currency amid Looming Sanctions: Sources

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Venezuelan Oil Company PDVSA Looks to Digital Currency amid Looming Sanctions: Sources

Venezuela’s State Oil Company PDVSA Turns to Digital Currency Amid Looming Sanctions

A sculpture representing an oil tower is displayed in front of the headquarters of the Venezuelan state oil company PDVSA in Caracas, Venezuela. The company is making a strategic shift towards using digital currency for its oil transactions in light of potential sanctions from the United States.

Sources with knowledge of the matter have revealed that PDVSA is gearing up to increase its use of digital currency to collect payments for crude oil and fuel exports. The move comes as the U.S. Treasury Department recently announced the expiration of a general license that allowed transactions with PDVSA, making it more difficult for companies to do business with Venezuela.

PDVSA has been gradually transitioning its oil sales to USDT, a digital currency pegged to the dollar, since last year. The imminent threat of oil sanctions has accelerated this transition, with the company now requiring advance payment of half the value of each cargo in USDT.

Tether, the company behind USDT, has committed to freezing sanctioned addresses in accordance with U.S. Treasury regulations. PDVSA is now urging clients and merchants to increase their use of digital currency to prevent their sales receipts from being frozen in foreign bank accounts due to sanctions.

The Venezuelan oil company is also implementing new measures, such as requiring clients to prove they have funds in a digital wallet and registering in its database. Minister of Petroleum, Pedro Tellechea, stated that PDVSA is open to using digital currencies as a payment method in certain contracts, although the dollar remains the preferred currency in the global oil market.

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One year after a corruption scandal rocked PDVSA involving unaccounted-for cargo payments, the company has since seen a surge in oil exports under new leadership. Despite facing challenges posed by potential sanctions, PDVSA is optimistic about continuing oil and gas projects through the use of digital currency transactions.

As Venezuela navigates through this uncertain period, analysts predict that the country’s oil production, exports, and revenue may soon hit a ceiling. Stay tuned as PDVSA and its partners adapt to the changing landscape of the global oil market.

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