The US has held off from restoring sanctions on Venezuela’s energy sector, despite the country banning the opposition’s leading candidate from participating in elections this year.
However, the Biden administration will restore sanctions if the South American nation upholds its ban, the State Department said.
The US will allow a six-month suspension on sanctions to expire in April if opposition candidate Maria Corina Machado is barred from running against Venezuela President Nicolas Maduro.
“Absent progress between Maduro and his representatives and the opposition Unitary Platform, particularly on allowing all presidential candidates to compete in this year’s election, the United States will note renew the licence when it expires on 18 April, 2024,” said State Department spokesperson Matthew Miller.
Venezuela President Nicolas Maduro has been backsliding on his promise of free and fair elections, jailing aides to the opposition presidential candidate and using Venezuela’s top court to uphold a ban against her and others holding office, according to Bloomberg.
“They need to make the right decisions here and allow opposition members to run for office and release the political prisoners that they’re holding right now,” National Security Council spokesperson John Kirby said during a Monday briefing. “They’ve got decisions they have to make before we weigh what decisions we’ll take” by April, he said.
However, the US government has pulled back part of the sanctions relief it granted Venezuela last year.
The US will rescind a licence awarded to Venezuela’s state gold producer, according to a statement from the US Treasury’s Office of Foreign Assets Control.
The US lifted sanctions on Venezuela’s oil exports for six months in October following a deal between the government and opposition parties for an internationally monitored election to be held next year.
The sanctions on Venezuelan state-owned oil and natural gas company PDVSA and Venezuela’s oil sector had been in place since 2019, when former US president Donald Trump’s administration targeted the oil export revenues of PDVSA, citing the company’s significant financial support for the Maduro regime.
Tanker pool operator Tankers International (TI) recently reported that Indian and Chinese refineries have been competing for cut-price Venezuelan crude cargoes after the US eased sanctions.
“The release of the US sanctions on Venezuela in the last quarter drove VLCC activity out of the country to 11 cargoes in December, from an average 2-5 liftings per month through the rest of the year. Chinese teapot refineries have been driving this development,” TI’s head of research Mette Frederiksen said.
“We also note a rise in cargoes from Venezuela to India, signifying that Indian refineries are coming back to the market since the secondary sanctions were imposed in 2020. They now vie with Chinese teapots for the discounted oil.”
