The opposition of Venezuela decided to block the deal with Rosneft for $500 million


Petroleum Commission on Wednesday decided to block any oil deals made without the approval of the National Assembly, reports Bloomberg, citing her decision. Now this statement should be considered at the meeting of the National Assembly.

Rosneft signed an agreement with Venezuelan company PDVSA about buying 23.3% in the JV Petromonagas, which develops the oil belt of the Orinoco (in 2015, the production has exceeded 7.7 million tonnes of oil), for $500 million in February. This transaction will allow it to increase its share in the JV to 40%. The signing ceremony was attended by the President of Venezuela, Nicolas Maduro, who said: “the global crisis and the economic war we get the necessary investments for the future”.

Recently strained relations between Maduro and the opposition-controlled Congress on economic and political issues, reminds Bloomberg. But the Supreme court has allowed Congress in previous attempts to block the exclusive power to Maduro. So, in March the court refused to cancel the special orders that allow the President to make economic decisions without the approval of Congress. The judge explained that the need to combat record inflation and a major economic downturn for the first time in over ten years.

The deal between Rosneft and PDVSA “illegal” because the government has not received the approval of the National Assembly, Bloomberg said opposition MP Milagros Paz. In the statement adopted by the Commission in oil Wednesday, the MPs refer to the 150th article of the Venezuelan Constitution, according to which investment in strategic sectors may not be exercised without the approval of the National Assembly.

Pro-government Supreme court, most likely, will block any initiative of the National Assembly, but opposition MPs want to question the legitimacy of the transaction in the long term if the government will change, says former Supreme court judge Juan Carlos Apitz.

Representatives of PDVSA and Rosneft declined to comment. There was also a representative of the Ministry of information and oil of Venezuela.