Polish buyers lost $424 million trying to purchase sanctioned Venezuelan oil with crypto

Orlen’s attempt to buy fuel from Venezuela ended up as a case study in how sanctions, oil trading, and stablecoins can turn into a very expensive mess. The transaction chain ran through Dubai, USDT, and a handful of intermediaries; by the end, $424 million had been lost on fees, failed conversions, and brokers who disappeared with the money.

1. The supply contract was signed in late 2023. Because of sanctions, Venezuela’s state oil company PDVSA demanded advance payment in USDT, but the contract between Orlen and Hannon did not mention cryptocurrency or any intermediaries. It only referred to an advance payment of two-thirds of the total amount.
2. After receiving the advance, Hannon signed a separate oil supply agreement with Lexcor Energy. Its 46-year-old Italian head, Vitonicola Mariano, said he was an “authorized agent of PDVSA.” Later, the company said that contract was forged, and that Hannon had in fact been dealing with a Venezuelan company of the same name.
3. To convert the money into USDT, Hannon first used an unnamed Dubai financial company, which exchanged 80 million USDT for a fee of about $400,000. Hannon then sent $135 million to Horizon Global, also based in Dubai, but it sent back only 85 million USDT. The remaining $50 million was never recovered, and Hannon is now suing the counterparty. Another $30 million went to Gold Mar International Trading, another Dubai company reportedly linked to Mariano. Gold Mar was supposed to transfer the funds to PDVSA through Lexcor, but the money never reached Venezuela.
4. The delivery date for the oil was set for 19 December 2023, but the three Orlen-chartered supertankers never received the cargo and sat idle off Venezuela’s coast. Hannon first blamed PDVSA’s price revisions, then said the Venezuelan side was giving priority to larger buyers.
5. In January 2024, Hannon’s chief personally traveled to Venezuela with USB drives containing access to wallets holding about $165 million in stablecoins. Two wallets, with 60 million USDT and 50 million USDT, were handed over to an intermediary at different times, but the intermediary disappeared with the money. A month later, another intermediary received a drive with 11 million USDT, and a few weeks after that, another drive with the same amount of stablecoins. He also disappeared with the crypto. Hannon says another $54 million was lost to crypto fees and other attempts to buy oil, bringing the total handed to fake brokers to $132 million.

In the end, one Orlen vessel loaded cargo, but not oil: it took on about 500,000 barrels of fuel oil under a new contract, and only half the agreed volume. Another ship later managed to load Venezuelan crude, though the article does not say how much.

Warsaw prosecutors are now investigating former Orlen executives for negligence. The former head of the Swiss unit and other ex-managers have also been charged with negligence. Separately, the US Department of Justice said an international network of intermediaries laundered more than $1.5 billion in proceeds from sanctioned Iranian oil sales, naming the Chinese companies Blessed Trust and Hexa Whale Trad as key intermediaries.