By Matt Spetalnick
WASHINGTON, (Reuters) – The Biden administration is easing sanctions on Venezuela’s oil and gas sector almost immediately in response to a 2024 election deal reached between the Venezuelan government and the country’s opposition, a senior U.S. State Department official told Reuters.
The official, speaking on condition of anonymity, said the U.S. was going ahead with broad sanctions relief for the OPEC-member nation. However, the U.S. threatened to reverse these steps unless President Nicolas Maduro’s government goes even further and agrees to lift a ban on opposition presidential candidates and release political prisoners.
The U.S. moves follow months of negotiations in which Washington had pressed Caracas for concrete actions toward democratic elections in return for lifting some – but not all – of the tough sanctions imposed under former U.S. President Donald Trump.
As a result of Maduro’s concessions to the U.S.-backed opposition, President Joe Biden’s administration is issuing licenses and authorizations that will include allowing Venezuela to resume long-suspended business with Caribbean nations, the official said.
It marks a significant step in the Biden administration’s increased engagement with Maduro on issues ranging from energy to migration, shifting way from Trump’s “maximum pressure” campaign against the socialist-governed country.
Maduro’s government and the opposition reached an agreement in Barbados on Tuesday on electoral guarantees for an internationally monitored vote to be held in the second half of 2024.
But the deal did not remove bans on opposition candidates the government had barred from public office and made no mention of freeing political prisoners, falling short of what the U.S. wanted to see.
The U.S. welcomes the election agreement but considers it “a partial agreement toward an electoral roadmap,” the official said, adding the U.S. was ready to take more steps around Venezuela’s crucial energy sector. “Today, tomorrow, it’s going to happen quickly”.
The official warned, however, that U.S. decisions on relaxed sanctions would depend on Maduro complying with the latest agreement and working toward free and fair elections.
“We’re willing to take specific actions, but if they fail to live up to their commitments, we can certainly withdraw those positive incentives,” the official said.
The official also expressed optimism that the process would lead to the release in a “relatively near term” of Americans jailed in Venezuela and designated by the U.S. as wrongfully detained.
The Venezuelan government did not immediately respond to a request for comment.
The U.S. imposed harsh sanctions on Venezuela to punish Maduro’s government following his 2018 re-election, which the U.S. and other Western governments rejected as a sham. Since 2019, U.S. sanctions have banned state-run oil company PDVSA from exporting to its chosen markets.
AGREEMENT IN BARBADOS
The State Department official provided only a few specifics on what the sanctions relief entailed but made clear it would not mean a full lifting of punitive measures.
A package that had been under consideration included resumption of gas exports to the Caribbean; expansion of Venezuela licenses for U.S. and other foreign oil services companies, fuel providers and contractors; and at least one additional foreign oil firm allowed to ship Venezuelan crude for debt repayment, according to a source close to the negotiations.
The U.S. has been seeking ways to boost global flows of oil to alleviate high prices caused by sanctions on Russia and OPEC+ decisions to reduce output. But chances Venezuela’s exports could offset those cuts are slim absent a big increase in investment in the country’s crippled oil sector, experts said.
Talks between the government and the opposition, meant to provide a way out of Venezuela’s long-running political and economic crisis, were held on Tuesday for the first time in nearly a year. They agreed to further meetings at an unspecified date.
The deal they announced says each side can choose its 2024 candidate according to its internal rules but did not reverse bans on some opposition figures – including Oct. 22 primary frontrunner Maria Corina Machado – that prevent them from holding office.
Opposition sources said they have not given up on trying to get those bans lifted.
