Polish PM condemns “disgrace” of failed Venezuela oil deal under former government following FT report

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Notes from Poland is run by a small editorial team and is published by an independent, non-profit foundation that is funded through donations from our readers. We cannot do what we do without your support.

Prime Minister Donald Tusk says that Poland has been “disgraced in front of the entire world” by a new Financial Times report on how Polish state energy firm Orlen lost $230 million (856 million zloty) trying to buy Venezuelan oil through intermediaries, unsecured payments and cryptocurrency transfers.

Tusk called the case a further example of “dirty deals” conducted under the former national-conservative Law and Justice (PiS) government, which was in power at the time. Orlen was then led by Daniel Obajtek, who is now a member of the European Parliament representing PiS.

Obajtek himself today said that he wants the issue to be clarified in court and suggested that the current authorities are using the case to distract from current soaring fuel prices.

In a report today, the FT provided new details on a case that has already drawn public attention in Poland. In April 2024, Orlen revealed that its Swiss oil trading subsidiary had lost around $400 million in prepayments for Venezuelan oil and petroleum products that were never delivered.

Orlen, which was under new management after Obajtek had been fired earlier that year following the arrival of Tusk’s government, said that the losses included around $240 million paid to a Dubai-based intermediary run by a 25-year-old from Hong Kong.

A week later, Polish prosecutors announced that they had launched an investigation into the case, focusing on Orlen Trading Switzerland (OTS), the subsidiary that oversaw the Venezuela deal.

The FT detailed how the then head of OTS, a Lebanese-born Polish citizen of Palestinian descent, who can be named only as Samer A. under Polish privacy law, had sought in 2023 to commission the import of Venezuelan oil through intermediaries, who were given a $230 million advance without any security or guarantees.

Although the United States, under then-President Joe Biden, had temporarily suspended sanctions on Venezuelan oil, allowing companies such as Orlen to buy it, Venezuela’s state oil company, PDVSA, remained largely cut off from the global financial system.

The FT detailed how the intermediaries therefore sought to use cryptocurrency to facilitate the deal. However, although oil tankers leased by Orlen to collect the oil sat waiting (accruing further large costs), the promised oil was not delivered, and Orlen’s advance payments were lost.

The issue is now the subject of a criminal investigation in Poland and an ongoing arbitration case with the intermediary in Dubai, Hannon International.

Speaking ahead of a meeting of his cabinet on Tuesday, Tusk said that the FT story is a “disgrace in front of the entire world”. He called the Venezuelan oil incident “the biggest scandal, or one of the biggest scandals, in our country’s history”.

Turning his aim on the opposition, he said that the case includes “everything that has recently been associated with PiS”, including “dirty deals” and cryptocurrencies.

That was a reference to an ongoing investigation into alleged links between a collapsed crypto firm, Zondacrypto, and figures associated with the opposition.

Tusk also noted that opposition-aligned President Karol Nawrocki has recently blocked government bills intended to better regulate crypto markets and to levy a windfall tax on fuel firms. “We may be dealing with a network of dirty and highly dangerous dealings,” said the prime minister.

Later on Tuesday, the regional prosecutor’s office in Warsaw also responded to the FT article by issuing a statement providing an update on the investigation into the Venezuelan oil deal.

They noted that the Polish authorities are continuing to seek the extradition of Samer A. from the United Arab Emirates, which last year rejected a request from Poland for him to be extradited.

The prosecutors also reported today that, last month, they issued indictments against three former senior Orlen and OTS executives for failing to fulfil their duties to oversee the companies’ assets, resulting in losses of $378 million.

Obajtek himself responded to the FT’s story, writing on social media that the newspaper “describes an important part of the OTS case”. He then suggested that the new management of OTS had terminated the Venezuelan oil contract too quickly, saying that the oil could in fact have been delivered.

“I hope this matter will be fully clarified, including before a Polish court!” wrote Obajtek. In a further post, he suggested that Orlen and the authorities are “trying to cover up current issues again, such as the most expensive fuel in history”.

In response, Orlen’s press office wrote under one of Obajtek’s posts that they would “help [him] with English”.

“The article is about how your team transferred hundreds of millions of dollars to a company owned by a 25-year-old from Dubai. He converted them into cryptocurrencies, which he copied onto USB drives. And then he handed them out in restaurants to people posing as oil traders…In this story, only Orlen’s money, which they lost, was real.”

Obajtek rose rapidly under the former PiS government, which ruled Poland from 2015 to 2023. He went from being the mayor of Pcim, a rural commune of 11,000 people in southern Poland, to the CEO of Orlen, Poland’s biggest company, in the space of three years.

Under Obajtek’s leadership, Orlen expanded rapidly, swallowing up other state energy firms and expanding into new areas of activity. By 2023, it was ranked among Europe’s 50 biggest companies.

However, Obajtek was also accused of using the company’s considerable resources to support PiS politically, including through Orlen’s purchases of hundreds of local media outlets – many of whose editors were replaced with PiS-friendly figures – and lowering fuel prices ahead of the 2023 elections.

Last year, at Poland’s request, the European Parliament stripped Obajtek of legal immunity to face charges for allegedly using Orlen’s funds to serve his own private interests. Polish prosecutors are also pursuing him for allegedly violating Poland’s press law and falsely reporting his income in a tax return.

Notes from Poland is run by a small editorial team and published by an independent, non-profit foundation that is funded through donations from our readers. We cannot do what we do without your support.

Main image credit: Orlen (press materials)

Daniel Tilles

Daniel Tilles is editor-in-chief of Notes from Poland. He has written on Polish affairs for a wide range of publications, including Foreign Policy, POLITICO Europe, EUobserver and Dziennik Gazeta Prawna.