SINGAPORE (Reuters) - Traders have rebranded more than $1 billion of Venezuelan oil shipments to China as Brazilian crude over the past year, according to two tanker tracking firms, company documents and four traders, helping buyers to cut logistics costs and circumvent U.S. sanctions.
Independent refiners in China are the main buyers of seaborne oil shipments from countries sanctioned by the United States, with offshore Malaysia serving as a key trans-shipment hub for Venezuelan and Iranian crude.
Since July 2024, however, traders have also rebranded Venezuelan oil as from Brazil. This has enabled tankers to sail directly from Venezuela to China, skipping the stop-over in waters off Malaysia and shortening the voyage by about four days.
Washington has imposed sanctions on Venezuelan energy exports since 2019 to reduce the oil export revenue that funds the government of President Nicolas Maduro, who has held power for more than a decade with elections that observers say were fraudulent.
Maduro and his government have rejected sanctions by the United States and others, saying they are illegitimate measures that amount to "economic war" and are designed to cripple Venezuela.
Since sanctions have been in place, oil traders have transferred oil from one ship to another at sea to disguise the origin of Venezuelan crude before it is shipped to China, which is the world's biggest crude importer.
More recently, shippers have tampered with the tankers' location signal to make it look like vessels are departing from Brazilian ports when they are actually sailing from Venezuela, according to maritime data, satellite imagery and shoreside photos compiled and analysed by monitoring service TankerTrackers.com. This practice is known as spoofing.
According to Chinese customs data, China imported about 2.7 million metric tons, or 67,000 barrels per day (bpd), of mixed bitumen from Brazil between July 2024 and March 2025, worth $1.2 billion.
Chinese refiners regularly buy Brazilian crude but Brazil rarely exports any bitumen blend, according to state oil company Petrobras. Brazilian customs data records no export of bitumen blend to China since at least 2023.
Mixed bitumen, or bitumen blend, is a tar-like residue for processing into asphalt. However, Brazil's typical crude grades for export are classified as medium-sweet oil from its prolific offshore fields known as pre-salt.
"What we export to China is mainly crude oil from the pre-salt, it's not bitumen," Petrobras CEO Magda Chambriard told reporters on the sidelines of a conference in Houston last week.
Many crude cargoes entering China branded as Brazilian bitumen actually contain Venezuela's Merey, the flagship heavy crude typically bought by China's independent refiners from Venezuela's state-run PDVSA through intermediaries, according to the trading sources, tanker tracker Vortexa Analytics and internal PDVSA documents reviewed by Reuters.
Traders have long branded Merey as bitumen blend, Chinese traders have said, because refiners do not need government crude oil import quotas to bring in the tar-like oil.
To effect the switch, dealers change the documentation of the shipments to Brazilian origin by providing a new certificate of origin for the oil, without sending vessels near Brazil or going through any ship-to-ship operations, three of the traders said.
This year, several vessels chartered by an intermediary of Venezuelan crude, Hangzhou Energy, have "spoofed" their signals - artificially placing them in Brazil while loading in Venezuela, according to PDVSA documents and the data compiled by TankerTrackers.com.
Reuters was unable to locate a contact for Hangzhou Energy, which according to the PDVSA documents has loaded crude from Venezuela as an intermediary since 2021.
The Liberia-flagged tanker Karina loaded 1.8 million barrels of Venezuelan Merey 16 crude for Hangzhou Energy in February under the name "Katelyn", according to one of the documents and TankerTrackers.com. It spoofed its signal while in Venezuela, making it appear that it had departed from Brazil. It discharged at China's Yangpu port in early April, according to TankerTrackers.com.
China's customs agency did not immediately respond to a request for comment. PDVSA, Venezuela's oil ministry and Brazil's government did not reply to requests for comment.
COST SAVER
Apart from shortening the voyage and saving the ship-to-ship costs, passing cargoes off as Brazilian helps to secure bank financing, said one of the traders, a regular dealer of Venezuelan oil.
"The savings on the freight front are not much, but it helps securing financing, relieving traders' financing pressure throughout the two-month-long voyages," the person said.
The traders declined to be named due to the sensitivity of the subject.
China, like Venezuela, has repeatedly said it opposes unilateral sanctions.
China is the main destination for Venezuela's crude exports.
Venezuela sent some 351,000 bpd of oil and heavy fuel to China last year. Volumes increased to 463,000 bpd in the first four months of 2025, according to PDVSA documents and shipping data compiled by Reuters.
Most of China's imports of Venezuelan oil are still declared as Malaysian, either as Malaysian crude or mixed bitumen, traders have said, with less than 10% officially reported as Venezuelan.
(Reporting by Chen Aizhu in Singapore; Additional reporting by Fabio Teixeira in Rio de Janeiro; Editing by Tony Munroe, Simon Webb and Edmund Klamann)
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