Wednesday, July 17, 2024

LATIN AMERICA | 19-10-2023 18:03

US to ease Venezuela oil, gas sanctions after election deal

The United States has announced that it will ease some oil and gas sanctions against Venezuela after the South American country's government and opposition agreed to hold elections next year supervised by the United Nations.

The United States will ease some oil and gas sanctions against Venezuela after the South American country's government and opposition agreed to hold elections next year.

In response to those "democratic developments," the US Treasury Department "has issued General Licenses authorizing transactions involving Venezuela's oil and gas sector and gold sector," and is "removing the ban on secondary trading" in debt securities, a statement from undersecretary for terrorism Brian Nelson said Wednesday.

But it also said that those authorizations could be amended or revoked at any time if the electoral deal falls through.

"Let's turn the page, let's rebuild a relationship of respect, of cooperation... this is my message to those in power, and to the government of the United States," Venezuelan President Nicolás Maduro said, while also calling for a definitive end to the sanctions.

To uphold the agreement, the United States warned Venezuela that it must "define a specific timeline and process for the expedited reinstatement of all candidates" by the end of November, US Secretary of State Antony Blinken said.

"All who want to run for president should be allowed the opportunity," he said in a statement.

The agreement between Washington and Caracas comes just a day after the Venezuelan government and opposition reached a deal in Barbados, mediated by Norway, to hold elections in late 2024. 

But that accord allows for the exclusion of certain candidates under Venezuelan law, which would include opposition frontrunner María Corina Machado.

US officials speaking on the condition of anonymity on Wednesday evening, however, said they believed Caracas was planning to eventually allow such candidates to participate. 

Blinken said "failure to abide by the terms of this arrangement will lead the United States to reverse steps we have taken."

Later in the day, five jailed opposition figures were released, according to a social media post by Gerardo Blyde, who represents the opposition in talks with the government.

Among them were journalist Roland Carreño and former lawmaker Juan Requesens, imprisoned in 2018 after an attack on Maduro.

Also on Wednesday, a charter flight from Texas arrived at Simón Bolívar International Airport in Caracas carrying about 130 Venezuelan migrants, the first such deportation flight following an agreement earlier this month between the two countries. 

The deal provides for the "orderly, safe and legal repatriation" of undocumented Venezuelan migrants, who until now had been deported in small numbers on commercial flights, mixed in with regular passengers.


Oil, gas, gold 

In concrete terms, the sanctions easing means the US government is re-authorizing the purchase of Venezuelan oil and gas for a period of six months, which may be renewed "only if Venezuela meets its commitments under the electoral roadmap as well as other commitments with respect to those who are wrongfully detained."

Regarding the gold sector, no time limit has been specified, with the Treasury Department stating it seeks to reduce black market trading.

Washington is also allowing renewed trading in Venezuelan debt securities on the secondary market, although the ban on the primary market – meaning debt securities newly issued by the Venezuelan government – remains in force.

The easing of sanctions on Venezuelan oil had been eagerly awaited by the markets, leading to a fall in the price per barrel despite the war between Israel and Hamas and the risk of escalation in the Middle East. 

An exact election date will be defined by the country's National Electoral Council, according to the text of the deal.

The two sides had resumed talks seeking to end the country's political and economic crisis, after a nearly yearlong suspension.

The opposition, backed by several countries including the United States, did not recognize Maduro's 2018 re-election in a vote widely dismissed as fraudulent.

The following year, Washington ramped up sanctions against Caracas first imposed in 2015 over the brutal repression of anti-government protests.

But the energy crisis sparked by Russia's war on Ukraine saw renewed global efforts to solve the crisis in Venezuela, which has the world's largest oil reserves.

Last year, US delegates went to Caracas to meet Maduro, even though Washington does not recognise him as a legitimate leader.

After initial talks between the government and the opposition, Washington granted a six-month licence to US energy giant Chevron.                




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