The US is preparing to reactivate sanctions on Venezuela for blocking the opposition

The United States is preparing to announce whether starting Thursday it will reactivate sanctions on Venezuelan oil and gas to punish President Nicolás Maduro for blocking the opposition in the elections scheduled for July.

The government of President Joe Biden is dissatisfied with the evolution of the electoral process in Venezuela since the signing of the Barbados Agreement last October.

Maduro, who is running for a third term in the July 28 elections, has respected the technical part of this deal reached with the opposition but, according to Washington, he has failed to comply with the condition of guaranteeing that everyone can present their candidates.

Ripe “has defended certain aspects of the Barbados agreement, including the establishment of an electoral calendar and the invitation to international observation missions” but “at the same time he has been seen blocking opposition candidatesState Department spokesman Matthew Miller said Tuesday.

Chavismo’s main rival, María Corina Machado, remains disqualified and Corina Yoris, nominated by her to replace her in the elections, has also been vetoed.

“Very clear”

“We have made it very clear that if Maduro and his representatives do not fully implement what was agreed upon in the Barbados Agreement, we would reimpose sanctions.”, raised to promote the electoral process, Miller insisted.

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

Venezuela’s production is around 800,000 barrels per day, after hitting a floor in mid-2020, when it plummeted below 400,000, but it is far from the three million it reached 15 years ago.

All in all, the income of the state oil company PDVSA went from US$3,000 million in 2022 to 6,320 million in 2023, according to the Venezuelan government, because the partial and temporary lifting of the embargo allowed shipments to be reestablished to countries like India.

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

“They keep blackmailing that they are going to remove the license 44″Maduro said this week in one of his television programs. “We are going to move forward with a license, without a license, we are not a gringo colony (…) no one is going to stop us”, he blurted out.

The embargo on Venezuelan oil and gas was imposed in 2019 as part of a battery of sanctions to try to bring about the fall of Maduro after the 2018 elections, considered fraudulent by Washington.

Intermediate option

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

Migration is one of the central issues of the US elections in November and Venezuela is a red point, with more than seven million people having left the country since 2014, according to the UN.

Furthermore, the United States, and also Europe, have been looking 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.

A “possibility” the thing is “let him die” the license and that later “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 debts with crude oil.

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

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

The Biden government has another variable in mind: the deadline to replace candidates in the Venezuelan presidential elections closes on April 20 and the opposition is racing against the clock to find a “unitary candidacy”.

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