As the country’s economy continues to tank, Venezuela’s national oil company PDVSA is approaching the deadline for a $1.1bn note issue due in November, and there’s a pretty good chance they’re not going to be able to make the payment. With a dire need for more cash and credit and soaring inflation rates at an all-time high of 886 percent, Venezuela is in desperate need of allies with deep pockets.

In their search for funding Venezuela has turned to Russian oil giant Rosneft. In 2016 PDVSA signed onto a loan from Rosneft offering 49.9 percent of its shares in Citgo, a U.S.-based, Venezuelan-owned refining company, as collateral. Thanks to this deal, Rosneft has a lien on all of PDVSA’s Citgo refineries in the US, meaning that if and when Venezuela defaults on the bond, Russia will seize their assets and own a number of refineries on U.S. soil. This is considerable news, as Citgo currently owns roughly 4 percent of refining capacity in the U.S.

Major sectors of U.S. downstream capacity are already owned by foreign interests, but the threat of Russian involvement has just recently called media attention to the issue. Britain’s BP, the Netherlands’ Royal Dutch Shell, Israel’s Delek, France’s Total, Mexican Pemex’s JV with Shell, and Canadian Husky Energy, to name just a few, are all major players in US-based refining.

While U.S. authorities have stated that they’ll challenge any attempt by Rosneft to seize Citgo’s assets, in reality Russian-owned refining capacity in the US might not be the major game-changer that it appears to be. While the Kremlin’s dealings on US soil make for some flashy headlines, it would just be another addition to an already ballooning problem of foreign companies growing refining capacity in the US. Currently, without Russian involvement, the US refining capacity is already about 30 percent foreign owned, amounting to about 5 million barrels per day.

Foreign owned refineries in the U.S. have been growing steadily since the 1980s, but until now the countries involved in downstream production on U.S. soil have posed little to no political threat. Russia, however, already controls about 11 percent of global oil production, and their seizure of downstream assets in the U.S. does pose a considerable concern for conflicting economic interests, prompting some experts to worry about vulnerability in U.S. energy and national security.

Related: Aggressive U.S. Oil Sanctions Could Bankrupt Venezuela

It’s quite possible - in fact it’s probable - that Rosneft’s potential activity on U.S. soil will have no negative impact on the U.S. economy, as their objective is presumably to keep making money. However, if for some reason they had political reason to withhold supplies of gasoline, diesel, and other refined products, they could do so on a whim, causing oil prices to spike and jeopardizing the U.S.’ economy and energy autonomy.

The already complex entanglement of Venezuela’s PDVSA and Russia’s Rosneft is further complicated by the increasing threat of sanctions by the U.S. against Venezuela. The White House has been discussing placing a halt on any dollar payments for Venezuelan oil, reportedly as part of a political strategy to prevent Maduro’s transition from President to Dictator (a move already well-underway).

In the light of this news, there were talks in Moscow last week between PDVSA and Rosneft (which is already under US sanction) to renegotiate their deal. According to Reuters, the talks floated a possible swap of Rosneft’s stake in Citgo for a number of other Venezuelan oil assets.

If the change-up of Rosneft’s assets comes to pass, it would solve the problem of Russian involvement in US refining, but the reality is that Russia is just one potential part of a much larger foreign “takeover” of US downstream production. The headlines are catchy, but they have mostly served to reveal the extent to which the nation has allowed foreign infiltration of their oil sector, and the potential political dangers the nation is thereby exposing itself to in today’s uncertain political climate.

By Haley Zaremba for Oilprice.com

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