Washington raising red flag over Russian control of US energy supplier

Washington raising red flag over Russian control of US energy supplier
Several US members of Congress have warned the White House of an imminent risk should Russia’s largest oil company Rosneft take control of Venezuela's Texas-based oil company Citgo.

Citgo, founded in 1910 by an Oklahoma businessman, was sold to Venezuela's state-run oil company PDVSA in 1990.

Last year 49.9 percent of the Houston-based corporation’s shares were offered as collateral when PDVSA obtained a loan of $1.5 billion from Russia’s Rosneft. Members of Congress are expressing serious concerns that Venezuela may default and hand Citgo over to Rosneft.

“We are extremely concerned that Rosneft's control of a major US energy supplier could pose a grave threat to American energy security, impact the flow and price of gasoline for American consumers, and expose critical US infrastructure to national security threats,” a bipartisan group in Congress wrote in a letter to US Treasury Secretary Steve Mnuchin on Monday.

Mnuchin serves as chairman of the US Committee on Foreign Investment, which is empowered to review foreign investment activity and recommend President Trump to block them.

“We ask that you proactively monitor the situation and that your staff keep our offices briefed on your efforts and any informal review process of Rosneft’s potential acquisition of Citgo,” the letter says.

The committee has a right to start a formal investigation only if Rosneft takes official action toward taking control of Citgo that operates several refineries, pipelines and nearly 50 oil terminals in the US.

Citing some respected international market analysts the group of senators led by Democrat Robert Menendez assured the US administration that crisis-ridden Venezuela is likely to default on its debt to the Russia energy giant, posing a “grave threat to American energy security.”