Venezuela has received $4 billion in financing from China, completing a loan announced last year that the South American OPEC nation will repay in shipments of fuel oil, President Hugo Chavez said on Thursday.
State oil company PDVSA has vastly expanded the practice of borrowing money and repaying it through in-kind oil and fuel sales, and has increased shipments to China to reduce Venezuela's traditional reliance on U.S. energy markets.
The money will be deposited into a $6 billion investment fund for domestic development projects, with Venezuela contributing the remaining $2 billion, according to the original announcement in November.
"From Beijing they deposited $4 billion," Chavez said during a televised speech. "This is the first time that the People's Republic of China, in its half century of existence, has signed an agreement like this one."
The accord could worsen the glut of fuel oil in East Asian markets, already inundated with 10-month high fuel oil inflows from Europe and the Caribbean of near 3 million tonnes each month in February and March....MORE