The move is apparently intended to protect Russia’s largest oil producer from U.S. sanctions while Moscow continues supporting Venezuelan President Nicolas Maduro.
The sale follows the U.S. imposition of sanctions on two Rosneft subsidiaries in an effort to cut a critical lifeline Russia extended to Maduro after the U.S. government made it illegal for Americans to buy crude from Venezuela.
The company, led by Russian President Vladimir Putin’s long-time associate Igor Sechin, said that its move meant that “all assets and trading operations of Rosneft in Venezuela and/or connected with Venezuela will be disposed of, terminated or liquidated.”
It said in a statement that it “concluded an agreement with a company 100% owned by the government of the Russian Federation, to sell all of its interest and cease participation in its Venezuelan businesses,” including multiple joint ventures, oil-field services companies and other activities.
The sale could help shield Rosneft by handing over control of the Venezuelan operations to a fully state-owned venture that unlike the state-controlled Rosneft isn’t answerable to private investors.
In February, the U.S. Treasury Department imposed sanctions on the Rosneft subsidiary based in Geneva that sells crude to European customers. U.S. authorities vowed to keep applying pressure and hit a second Rosneft subsidiary with sanctions earlier this month.
Rosneft spokesman Mikhail Leontyev said the company’s decision was aimed at “protecting the interests of our shareholders.” He added in remarks carried by Russia’s TASS news agency that Rosneft expected the U.S. to now waive sanctions against its subsidiaries.
“We really have the right to expect American regulators to fulfill their public promises,” he said.