In order to get out from under the American – therefore capitalist, sneaky and imperialist – sanctions placed upon Venezuela’s oil business they decided that they would go and bank at Gazprombank. Surely being under Putin’s wing would protect their money? As it turns out, no.
As in fact I predicted as this all started.
Russian lender Gazprombank has decided to freeze the accounts of Venezuelan state oil company PDVSA and halted transactions with the firm to reduce the risk of the bank falling under US sanctions, a Gazprombank source told Reuters on Sunday.
Here’s what the actual point is:
Venezuela is trying to create a payment system for its oil that doesn’t use the US dollar. This is because of the sanctions that the US has placed upon that country in an attempt to unseat Nicolas Maduro. Creating a non-dollar payment system for the oil is trivially easy and makes near no difference to anything at all. Creating a payment system that avoids the US banking system is near impossible. It’s the difference between those two that matters.
As to the how it’s done, here again is one I prepared earlier:
Any dollar transaction is claimed by the US to be part of that US banking system to which sanctions apply. Equally, anyone who has a US banking licence is a hostage to fortune because that licence is at the mercy of the US authorities.
Which is where how far they’re willing to go comes in. Maybe Gazprombank doesn’t have substantial US business. Maybe the accounts won’t be working in dollars – unlikely but possible. But the people who deal with Gazprombank might well have US interests which are themselves under that power of the US authorities. And there’s pretty much no global oil firm which isn’t tied into the US economy. So, if they really wanted to the US could tighten the noose even with this move by Venezuela to a Russian bank.
It just depends upon how serious the US is with these sanctions. Do they want enough just to trouble, weaken, Maduro? Or to really do it and kill his regime off?
My supposition is that someone “had a little word” with Gazprombank and suggested that perhaps they didn’t want to be risking taking Maduro’s money. Might not be quite how we’d like international diplomacy to work but it is how it does. I was on the very fringes – the very very fringes- of a story of Lloyds Bank being threatened with the loss of their US banking licence if they persisted in running an account for Interpal. At that time an entirely legal British organisation. No, really, legal, British charity – however awful in reality- you run a bank account for them in the UK you’ll lose all your American business.
Which is what’s happened here, someone’s had a word.