Citgo Petroleum Corp. may move forward with an attempt to collect more than $40 million it claimed from insurers after Venezuelan authorities in 2020 seized almost a million barrels of its oil.
(Bloomberg) — Citgo Petroleum Corp. may move forward with an attempt to collect more than $40 million it claimed from insurers after Venezuelan authorities in 2020 seized almost a million barrels of its oil.
US District Judge Gregory Wood on Wednesday denied the insurers’ request to dismiss Citgo’s claims, writing that the company had established two important facts: that it owned the oil and that it may have lost it as a result of the political chaos gripping Venezuela, thereby triggering the insurrection clause in its insurance policy.
“When democracy falters, bad things happen,” the judge wrote, including insurance disputes that stem “from the implosion of a democracy.”
Citgo loaded the 960,000 barrels of crude oil on an oil tanker in Paria, Venezuela, in January 2019. As it was loading the oil, then-President Donald Trump sanctioned Venezuelan state-owned company Petróleos de Venezuela SA. That led to a dispute over who owned the oil and Venezueal, with the help of its military, seized it.
- Read more: Seized Oil Cargo Is Latest Twist in Venezuela’s Political Fight
The case is Citgo Petroleum Corporation v. Ascot Underwriting Limited, for and on behalf of Lloyd’s Syndicate 1414, 1:21-cv-00389, US District Court, Southern District of New York (Manhattan).
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