The United States is set to reimpose oil sanctions on Venezuela as announced by the Biden administration. This decision comes in response to President Nicolas Maduro’s failure to fulfill promises for democratic reform after the elections.
According to a statement from State Department spokesperson Matthew Miller on Wednesday, companies will be given a 45-day window to gradually cease their operations in Venezuela’s oil and gas sector.
The U.S. had previously provided relief from sanctions on Venezuela’s state-controlled oil, gas, and mining sectors in October, contingent upon collaboration with opposition members to organize a genuinely open presidential election. However, Maduro’s government was accused of manipulating the process, leading to concerns about compliance.
Christopher Sabatini, a research fellow at Chatham House, noted that the decision to renew sanctions reflects the U.S.’s stance on the lack of compliance by the Maduro government. The administration’s concern about potential impacts on global oil prices and migration flows to the U.S.-Mexico border during an election year also factored into the decision-making process.
While Venezuelan officials expressed readiness for renewed sanctions, analysts anticipate constraints on the country’s crude oil production and growth unless individual authorizations are granted. Notably, Chevron, the last major U.S. oil driller in Venezuela, will not be affected due to its independent authorization.
“We are prepared commercially,” stated Oil Minister Pedro Tellechea at a press conference in Caracas. “Logistically, we will continue producing.”
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