Rosneft close to shutting trading unit targeted by OFAC

Russian state-controlled oil giant Rosneft, designated by the US Office of Foreign Assets Control (‘OFAC’) in February for dealing in Venezuelan oil, is close to shutting its Swiss trading unit, according to media reports.

‘A winding-down of the Geneva-based operation is under way, according to two people with knowledge of the situation, while some employees have been sent home in recent weeks and senior staff have been looking for jobs elsewhere,’ London’s Financial Times newspaper has reported.

On 18 February, OFAC said it had ‘designated Rosneft Trading S.A., the Swiss-incorporated, Russian-controlled oil brokerage firm pursuant to Executive Order (E.O.) 13850, as amended, for operating in the oil sector of the Venezuelan economy.

‘OFAC also designated the chairman of the board of directors and president of Rosneft Trading S.A., Didier Casimiro, for purporting to act for or on behalf of, directly or indirectly, Rosneft Trading S.A’, OFAC said.

The newspaper said Rosneft had issued a statement saying, ‘The future of (Rosneft Trading) as a trading business and its mandate is currently being considered, taking into account a potential change in the position of the US regulators given comprehensive actions undertaken by the company to date,’ quoting another person with knowledge of the talks as saying that closure is among options being considered.

The Trump administration has accused Rosneft of supporting the regime of Venezuelan President Nicolas Maduro with the oil trade. US Treasury Secretary Steven Mnuchin has vowed that Washington was ‘committed to targeting those who support the corrupt regime’s exploitation of Venezuela’s oil assets.’

Swiss brokering arm has been targeted by OFAC for activities in the Venezuelan oil sector.