Former Petrobras Executive Sentenced To 12 Years

By Reuters 2015-08-17 16:10:51

A Brazilian judge sentenced Nestor Cervero, former international chief of state-run oil firm Petrobras, to just over 12 years in prison on Monday for corruption and money laundering related to a bribe allegedly paid to the speaker of Brazil’s lower house of Congress.

Cervero and two other defendants are accused of organizing bribes from Korean shipbuilder Samsung Heavy Industries in exchange for two drillship contracts, the Petrobras 10000, which was leased jointly by Petrobras and Mitsui in 2006, and the Vitoria 10000, hired by Petrobras in 2007.

Consultant Julio Camargo, who said in plea bargain testimony that Speaker Eduardo Cunha asked him for a $5 million bribe, was given a 14-year sentence that was reduced to reporting to police twice monthly and doing community service because he collaborated.

Lobbyist Fernando Soares, accused of funneling bribes to Cunha’s Brazilian Democratic Movement Party (PMDB), was sentenced to just over 16 years in jail.

Cunha, who quit President Dilma Rousseff’s ruling coalition last month, accused her government of framing him in the broadening scandal focused on Petroleo Brasileiro SA, or Petrobras.

He was not a defendant. But the sentences handed down by federal judge Sergio Moro could give federal prosecutors in Brasilia more ammunition to bring charges against Cunha and other politicians thought to have benefited from the price-fixing and political kickback scheme.

Cervero’s lawyer, Edson Ribeiro, did not immediately respond to request for comment but had previously tried to move the case away from Judge Moro in the southern city of Curitiba, arguing the Supreme Court should take the case after Cunha’s name was mentioned. Only Brazil’s high court can legally try sitting lawmakers and ministers.

Moro, who has become the face of an anti-corruption movement, defended his right to try the case. The broader scheme was discovered in his state and related facts are required to remain with the same judge, he wrote.

Cervero’s 12 years and three-month sentence was the second he has received from Moro. In May he was sentenced to five years in prison for using a front company to launder money stolen from Petrobras and buy a luxury apartment in Rio de Janeiro. He was fired from Petrobras in 2014 and arrested in January as he stepped off a plane from Europe.

Executives at Samsung Heavy Industries are not being charged and the company has not responded to request for comment about the case.

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South China Sea Nations Clash Over Maritime Territories

By MarEx 2015-08-17 15:56:58

China claims that it is a sovereign nation and that the U.S. has no right to patrol near its territorial waters. The U.S. insists that it is simply protecting its Allies interests in Asia.

Meanwhile, tensions and maritime territorial disputes are mounting in the South China Sea. But, Beijing has been downplaying its neighbors concerns. In the August 6 meeting of China-ASEAN Foreign Ministers, Chinese Foreign Minister Wang Yi stated that all is well in the region and any issues should be resolved without outside interference.

Japan, Vietnam, the Philippines, Malaysia, Brunei and Taiwan have been the most vocal as China has constructed offshore platforms, conducted air drills and reclamation projects in the region.

On August 3, the Japanese government released 14 photos of newly constructed offshore platforms by the Chinese. The photos identified 16 locations where China erected platforms in the disputed maritime territories.

For more information, you can read MarEx’s report here.

During the China-ASEAN meeting, the ministers stressed all parties should exercise constraint and avoid actions that could escalate tensions.

China’s primary issue is that the U.S. has conducted drills in the region and claims the U.S. is trying to militarize the region.

Wang says there is no possibility of conflict in the region and any unrest is due to the media’s portrayal of the situation. He also outlined China’s historical claims to the South China Sea islands and ridiculed Japan and the Philippines for creating discord.

Wang refuted claims that China restricts navigation and overflights in the South China Sea. He states that China has now ceased its reclamations projects. But, other nations say it is only because China completed its offshore platforms.

Japan has recently joined the U.S. in military exercises off the coast of the Philippines. On August 14, a Japanese Navy replenishment ship was in Subic Bay to refuel a U.S. Navy floating hospital. Subic Bay is a former U.S. military installation. This is the first time ever that the Japanese were involved in military exercise.

The military exercise was ongoing trilateral engagement between the U.S., Japan and the Philippines. U.S. Navy officials said that the Japanese are interested in conducting future exercises with the Philippines.

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Authorities Seize 1,000 Pounds Of Marijuana In Jamaica

By MarEx 2015-08-17 11:48:21

Over 1,000 pounds of compressed marijuana has been seized in Kingston, Jamaica. Narcotics agents discovered the drugs in two shipping containers, one destined for Suriname and another headed to the Netherlands.

No arrests were made in the incident. Jamaica recently amended its drug laws to partially decriminalize the possession of small amounts of marijuana, but trafficking is still illegal.

In 2014, the International Narcotics Control Board (INCB) released a report stating that Jamaica is the largest illicit producer and exporter of cannabis in Central America and the Caribbean.

The report noted that Jamaican drug trafficking takes place at airports, seaports via containers, cargo vessels and underwater canisters attached to shipping hulls.

Suriname, Guyana and Trinidad and Tobago are the most frequent recipients of Jamaica’s illicit exports, according to the INCB.

The report also stated that the ports of Kingston and Montego Bay are used for the bulk shipment of marijuana and cocaine to Europe and throughout the U.S., and adds that corruption, violence and intimidation are used to circumvent legal controls.

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Ship Bursts Into Flames On Suez Canal

By MarEx 2015-08-17 11:39:51

In the first incident since the Suez Canal’s August 6th inauguration, the M/V Om el-Kheir caught fire while berthing at Port Tawfik. The Port is at the Canal’s southern entrance.

The Suez Canal Port Authority (SCA) and Red Sea Ports Authority (RSPA) rescue teams extinguished the fire and rescued the cargo vessel’s crew 13 members. Authorities are investigating the cause of the fire. Traffic at the southern entrance was unaffected by the incident.

The Om el-Kheir, which was enroute to Cambodia.

President Abdel Fatah el-Sisi inaugurated the New Suez Canal Aug. 6, a parallel canal to the Suez, to facilitate and accelerate international trade.

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Libya Needs Weapons To Defend Its Oil

By MarEx 2015-08-17 10:45:59

Libya’s Petroleum Facilities Guard (PFG) said its forces need more weapons to fight the Islamic State (ISIS), which is fighting for control of two of the nation’s largest crude export facilities of Es Sider and Ras Lanuf. Both ports have been under attack most of the year.

ISIS recently gained control of Sirte and Naufaliya, which is about 30 miles from Es Sider. These two regions contain about 70 percent of Libya’s crude oil reserves.

In a PFG statement, the group said that populated areas cannot be won by air power alone and additional ground forces, weapons and ammunition are needed.

Libya use to export about 1.6 million barrels of crude oil per day prior to the 2011 rebellion, which ended Qaddafi’s rule. Today, the output is only 400,000 barrels and Libya is now OPEC’s smallest producer due to the ongoing civil unrest.

In December, Libya stopped crude exports from the two ports after militias attacked Es Sider, its largest oil terminal. And the National Oil Corporation (NOC) declared force majeure at both ports. Force majeure is a legal status, which protects a party from liability if it cannot fulfill a contract for reasons beyond its control.

The PFG also wants the U.N. Security Council to lift an arms embargo that prevents its forces from receiving weapons. The ban was originally placed on Qaddafi’s regime

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VLCC rate fall put in context

VLCC rates may have halved from the start of the year but ship owners should see the situation in context, brokers told IHS Maritime.
Rates for the benchmark Gulf-Far East route averaged Worldscale 39.14 or USD39,000 on 14 August, a fall of almost 20 points from 31 July, when rates averaged W56.04
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Thailand’s RCL stays in profit

Regional Container Lines (RCL) of Thailand has managed to remain in profit, despite second-quarter results considerably lower than last year.
It posted a net gain of THB55 million (USD 1.55 million) for the quarter that ended on 30 June. The comparable figure last year was THB 294 million (USD 8.3
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