U.S. grants Chevron oil pumping license in Venezuela
The move came as the government of Nicolás Maduro held its first formal talks with Venezuela’s opposition coalition in more than a year. The two sides met in Mexico City Saturday to agree to ask the United Nations for management of several billion dollars in foreign bank funds that were frozen by the government to alleviate a humanitarian crisis in Venezuela.
The negotiators also agreed to continue talks next month to discuss a timetable for “free” elections in 2024 and human rights issues.
“We have long made clear we believe the best solution in Venezuela is a negotiated one between Venezuelans,” said a senior Biden administration official who spoke on the condition of anonymity under rules set by the White House. “To encourage this, we have also said we were willing to provide targeted sanctions relief.”
The policy “remains open to further calibrating sanctions,” the official said. “But any additional action will require additional concrete steps,” including the release of political prisoners and recognition of opposition legitimacy, as well as unfettered access for U.N. humanitarian missions.
The official dismissed reports that the administration was acting to ease an oil shortage and high energy prices exacerbated by Russia’s invasion of Ukraine. “Allowing Chevron to begin to lift oil from Venezuela is not something that is going to impact international oil prices. This is really about Venezuela and the Venezuelan process,” the official said, where the United States is “supporting a peaceful, negotiated outcome to the political, humanitarian and economic crisis.”
Venezuela has the world’s largest oil reserves, slightly more than Saudi Arabia, although its thick crude is more difficult to extract. But its production faltered due to poor government management even before Maduro took over in 2013 after he death of Hugo Chávez, a former military officer who was elected in 1998.
U.S. sanctions against Venezuela that began 15 years ago on grounds of drug trafficking, corruption and human rights abuses gradually expanded, culminating under Donald Trump’s administration. Trump sharply tightened measures against the state oil company, Petróleos de Venezuela, S.A. or PDVSA; the central bank; and individuals and companies. Activities of the U.S. oil companies were almost entirely banned.
These sanctions were imposed to stop oil sales worldwide. Production fell sharply because black market exports were mainly sold to India and China. When the Venezuelan opposition declared December 2018 elections illegitimate, it recognized Juan Guaidó, the opposition leader in the parliament, as interim president. The United States followed suit and recruited dozens of Latin American countries to do so.
However, Maduro’s economic and political pressure was ineffective. Venezuelans were left with the burden of a crumbling economy and oppression. This led to millions fleeing to neighboring countries, as well as the United States. Since then, the number of Venezuelan refugees has increased.
President Biden came to office convinced that Trump’s Venezuela policy had failed, but he took few steps to reverse it, as powerful lawmakers vowed to block any action and the administration retained hopes of winning the midterm votes of anti-Maduro Venezuelans and other Latin Americans in Florida. As recently as the summer, Biden called Guaidó to assure him of continued American recognition and support, even as other governments and members of Guaido’s own opposition coalition were turning away from him and calling for negotiations with Maduro.
The Republican electoral victory in Florida seemed to convince the administration that it was now time to move. Officials at Chevron have stated that it will take time for their Venezuela operations to resume normal operation.
The sanctions change appears to be an agile circumvention of a main complaint of U.S. critics — the possibility that the Maduro government would benefit directly. PDVSA will not receive any Chevron profits through its joint venture under the license.
Maduro will not be worse off than now and one crack may lead to more sanctions. Any global energy supply reduction is considered positive by the administration, provided that negotiations with the opposition continue toward democratic elections, human rights improvements, and a continuation of the talks with Maduro.
In a statement Saturday on the resumption of talks in Mexico, Sen. Robert Menendez (D-N.J.), the chairman of the Senate Foreign Relations Committee and a longtime hard-liner on Venezuela, said that “if Maduro again tries to use these negotiations to buy time to further consolidate his criminal dictatorship, the United States and our international partners must snap back the full force of our sanctions that brought his regime to the negotiating table in the first place.”