The United States reimposes sanctions against Venezuela’s oil and gas sector

U.S will not renew license 44 that eases sanctions on oil and gas in Venezuela when it expires on Thursday because the government prevents opponents from running in elections and represses activists, US authorities announced this Wednesday.

The Office of Foreign Assets Control (OFAC) will “replace” this license with one that will allow pending transactions to be settled “before May 31,” said a US official who requested anonymity. He specified that Washington can issue “specific licenses” at the request of companies, which it will evaluate “on a case-by-case basis.”

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Mature “has defended certain aspects of Barbados Agreementincluding establishing an election calendar and inviting international observation missions,” but “at the same time, we saw blocking opposition candidates,” State Department spokesman Matthew Miller said Tuesday.

Chavismo’s main rival, Maria Corina Machado, still disabled and Corina Yoris, whom she nominated to replace her in the elections, was also vetoed.

“Very clear”

“We make it very clear that if Mature and its representatives do not fully implement what was agreed in the Barbados Agreementwe would reimpose sanctions”, lifted to promote the electoral process, Miller insisted.

The general license 44which authorizes transactions related to the oil and gas sector, expires this Thursday.

The production of Venezuela It is around 800,000 barrels per day, after reaching a bottom in mid-2020, when it fell below 400,000, but it is far from the three million it reached 15 years ago.

With all, The revenue of the state oil company PDVSA went from 3,000 million dollars in 2022 to 6,320 million in 2023according to the Venezuelan government, because the partial and temporary lifting of the embargo allowed the reestablishment of shipments to countries such as India.

Everything indicates that Maduro assumes that the United States will reimpose sanctionsalthough representatives of his government and US officials have held several meetings in recent days.

“They continue to blackmail saying they are going to withdraw the 44 license.”Maduro said this week on one of his television programs. “We will move forward with a license, without a license, we are not a foreign colony (…) no one will stop us,” he said.

Venezuela’s oil and gas embargo was imposed in 2019 as part of a battery of sanctions to try to bring about the downfall of Mature after the 2018 elections, considered fraudulent by Washington.

Intermediate option

The United States has already imposed sanctions on gold but it must weigh the pros and cons when deciding whether to reverse the relaxation of the oil embargo less than seven months before the presidential election.

O migration It is one of the central issues of the US elections in November and Venezuela It’s a red dot, with more than seven million people having left the country since 2014, according to the UN.

What is more The United States, and Europe for that matter, has been searching for stable energy sources since Russia invaded Ukraine.

There is a plausible intermediate scenario, according to Francisco Monaldi, director of the Latin American Energy Program at the Baker Institute at Rice University, in Texas.

One “possibility” is that the license will be “let die” and that they will subsequently “authorize licenses” to multinationals such as the French Maurel & Prom.the Spanish Repsol or the Italian Eni, because that would “keep Maduro interested” in a negotiation, he considered in a meeting with foreign correspondents.

It would be along the lines of that granted to the American giant Chevron in November 2022 to operate in Venezuela and collect outstanding crude oil debts.

“If the license is revoked there will be no political changes, but the small hope of economic recovery is reduced”, estimated Oscar Duval, president of the brokerage Rendivalores.

Venezuela had growth of 15% in 2022 and 5% in 2023 according to the governmentafter eight years of recession, in which GDP contracted by 80%.

The government of Biden has another variable in mind: April 20th is the deadline for replacing candidates in the Venezuelan presidential elections and the opposition is racing against the clock for a “unitary candidacy”.

So far, Chavismo has ruled out reversing the disqualifications, despite accepting a mechanism to review them, to which Machado submitted.

Source: Elcomercio

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I am Jack Morton and I work in 24 News Recorder. I mostly cover world news and I have also authored 24 news recorder. I find this work highly interesting and it allows me to keep up with current events happening around the world.