The United States government is looking into reports that Hurd’s Bank off Malta has become a staging ground for ship-to-ship transfers to hide Russia’s supplying of chemicals that Venezuela’s industry desperately needs to dilute its heavy crude.

The probe was confirmed yesterday by a senior US official speaking to the Associated Press on the condition of anonymity because he wasn’t authorized to discuss the matter publicly.

Venezuela had imported diluents from the US.

As much as 435,000 tonnes of Russian oil products are reported to have completed ship-to-ship (STS) operations off Malta for onward shipment to Venezuela in January-June, according to data from oil analytics firm Vortexa.

The agency had reported in August that a total of 13 tankers were involved in the Venezuelan shipments. They loaded mostly clean products — notably naphtha, which accounted for around 330,000 tonnes. But a middle distillates cargo and a shipment of vacuum gasoil (VGO) were also spotted.

The rare shipment of Russian VGO could be linked to recent efforts by Venezuelan state-owned PdV to boost scarce gasoline supplies in the country.

While using ship-to-ship transfers off Malta for the creation of larger cargoes for long-haul shipments is relatively common, the trend of onward shipments to Venezuela has developed this year, with no evidence of it having happened in 2018.

The naphtha shipped to Venezuela via Malta this year has was usually loaded from the Black sea port of Tuapse.

Venezuela requires naphtha for blending with its extra-heavy sour crude to create diluted crude for transport and blending. But US sanctions have blocked access to the US-produced naphtha, prompting Caracas to look further afield for supplies.

Direct shipments of oil products from Russia to Venezuela have also occurred this year, according to various reliable reports. Around 20,000-25,000 tonnes of gasoline and gasoline components were shipped from Ust-Luga to Amuay Bay and El Palito in February, according to Vortexa data.

Just 280,000 tonnes of Russian products were shipped to the US via Malta in January-June, down from 440,000 tonnes a year earlier. Products shipped to the US from Malta include VGO and straight-run fuel oil — tight supplies of these products in Europe in recent months could have contributed to the reduction in transatlantic flows.

Venezuela reportedly received at least 616,000 barrels of petrol and 500,000 of vacuum gas oil (VGO) via Malta.

More Russian cargoes could be coming as the vessel commander, which loaded VGO in Taman in late July, is also reportedly heading for Malta.

“Criminals connected to Venezuela are getting increasingly creative as they manipulate the laws that govern international maritime commerce to bypass sanctions,” said Ian Ralby, head of IR Consilium, a U.S.-based consultancy focused on maritime and resource security.

“Authorities in the region and beyond need to be both alert and proactive in preventing the Maduro regime from using illicit activity to convert Venezuelan resources into cash.”

Along with the chemical transfers, there is also reportedly a great deal of petrol transfers taking place at Hurd’s Bank.

The Financial Times reported recently it had seen data showing that the Russian state-owned oil company Rosneft has supplied all of PDVSA’s (Venezuela’s state oil company) petrol for the month of June via ship-to-ship transfers off the shores of Malta, Gibraltar and Aruba.

The newspaper reported that it has seen evidence showing that eight cargos of petrol totalling 1.7 million barrels arranged by Rosneft Trading, the company’s Geneva-based trading arm, were loaded offshore near Malta, Gibraltar and Aruba, the documents show.

The tankers, according to the report, then headed for Venezuelan ports where the petrol was delivered to PDVSA.

It was unclear whether the companies supplying Rosneft with the cargoes of petrol even knew the final destination was Venezuela. Some of the shipments reportedly originated in the Netherlands, Greece and Turkey before being transferred at sea off Malta and elsewhere.

The FT estimated that the 1.7 million barrels supplied by Rosneft Trading in June equate to a supply of about 56,000 barrels per day, or about a quarter of Venezuela’s petrol consumption two years ago.

Questions sent to the Foreign Affairs Ministry remain unanswered.