WASHINGTON: The administration of President Donald Trump lifted some sanctions on Venezuela’s oil industry on Thursday to make it easier for US companies to sell its crude oil, and said more restrictions on the country would be lifted soon.
The move by the Treasury’s Office of Foreign Assets Control authorizes US companies to buy, sell, transport, store and refine Venezuelan crude oil, but does not lift existing US sanctions on production.
A White House official said the measure “would help flow existing product” from Venezuela and that there will soon be more announcements on the easing of sanctions.
Trump has said the United States intends to control Venezuela’s oil sales and revenues indefinitely since US forces seized the country’s leader Nicolas Maduro in a raid on the capital Caracas on January 3.
He has said he also wants US oil companies to eventually invest $100 billion dollars to restore the OPEC-member nation’s production to its historic peaks following years of underinvestment and mismanagement.
In the meantime, Washington and Caracas have already agreed an initial deal to sell 50 million barrels of Venezuelan crude oil, with European trading houses Vitol and Trafigura marketing the supply.
Treasury’s new authorization, known as a general license, opens up Venezuela oil trade to additional companies, provided they are from the United States.
It allows transactions involving the government of Venezuela and state oil company PDVSA related to “the lifting, exportation, reexportation, sale, resale, supply, storage, marketing, purchase, delivery, or transportation of Venezuelan-origin oil, including the refining of such oil, by an established US entity.”
It specifically excludes firms and individuals from rivals like China, Iran, North Korea, Cuba and Russia.
During President Donald Trump’s first administration, Treasury designated Venezuela’s entire energy industry as subject to US sanctions in 2019 after Maduro’s first re-election, which Washington did not recognize.
The new license does not authorize any payment terms that are not commercially reasonable, involve debt swaps or payments in gold, or are denominated in digital currency.
America first
Oil producers Chevron, Repsol and ENI, refiner Reliance Industries, and some US oil service providers had sought licenses in recent weeks to expand output or exports from the OPEC member.
Expanding production in the country would require additional US authorizations.
Jeremy Paner, a lawyer at Hughes Hubbard & Reed and a former OFAC sanctions investigator, said the authorization is broad in the sense that it opens up many operations including refining, transportation and “lifting” of Venezuelan oil.
But he said the scope is narrow in that it only applies to US companies.
Kevin Book, an analyst at ClearView Energy Partners, said the authorization could provide clarity for US companies while maintaining the previous standard of case-by-case review for non-US entities.
“In short, it appears to offer ‘America First, Others Ask’ sanctions relief.”
The large number of individual requests to the US government had delayed progress on plans to expand exports and get investment moving quickly into Venezuela, two sources said this week.
The new OFAC license, meanwhile, came as lawmakers in Venezuela on Thursday approved a sweetened reform of the country’s main oil law that is expected to grant autonomy to private producers in joint ventures or under new contracts to operate their projects and commercialize the output.
It also formalizes an oil production-sharing model first introduced by Maduro and negotiated with little-known energy firms in recent years.
Francisco Monaldi, director of the Latin American Energy Program at Rice University’s Baker Institute in Houston, said he wondered if the exclusion of Russian and Chinese entities would make it hard for PDVSA to operate or market oil from those ventures. Ventures with those countries produce about 22 percent of the oil, he said.
“If they cannot export the oil coming from these ventures, that’s a big problem.”
US lifts some Venezuela sanctions to ease oil sales
https://arab.news/jdqek
US lifts some Venezuela sanctions to ease oil sales
- Broad US license eases some sanctions on Venezuelan oil
- Does not ease measures on production of Venezuelan crude
Rubio meets Caribbean leaders as US raises pressure on Cuba
Basseterre: US Secretary of State Marco Rubio will seek to address Caribbean leaders' concerns about Cuba at a summit on Wednesday, as Washington ramps up pressure on the communist island fresh after removing Venezuela's president.
Rubio, a Cuban-American who has spent his political career hoping to topple Havana's government, is also looking for sustained cooperation on Venezuela and troubled Haiti as he takes part in the summit of the Caribbean Community, or CARICOM, which does not include Cuba.
After attending President Donald Trump's State of the Union address to Congress, Rubio flew overnight to join the summit in Saint Kitts and Nevis, a sun-kissed former British colony of fewer than 50,000 people.
Rubio became the highest-ranking US official ever to visit the tiny country, the birthplace of one of the United States' founding fathers, Alexander Hamilton.
Trump has reoriented foreign policy toward the Western Hemisphere through his "Donroe Doctrine" in which he has vowed unrepentant intervention to advance US interests.
After US forces snatched Venezuela's leftist leader Nicolas Maduro in a January 3 raid, the Latin American country has been forced to cut off its crucial oil shipments to Cuba.
This has plunged Cuba into a further economic morass with fuel shortages and rolling blackouts.
Speaking at the opening of the CARICOM summit on Tuesday, Jamaican Prime Minister Andrew Holness warned that a further deterioration in Cuba will impact stability across the Caribbean and trigger migration -- the top political concern for Trump.
"Humanitarian suffering serves no one," Holness said. "A prolonged crisis in Cuba will not remain confined to Cuba."
Plea for 'stability'
Holness said that Jamaica believed in democracy and free markets -- a rebuke to the communist system in Havana -- but called for "humanitarian relief" for Cubans.
"Jamaica supports constructive dialogue between Cuba and the United States aimed at de-escalation, reform and stability," he said.
"We believe there is space, perhaps more space now than in years past, for pragmatic engagement."
The summit's host, Saint Kitts and Nevis Prime Minister Terrance Drew, also called for humanitarian backing to Cuba, saying: "A destabilized Cuba will destabilize all of us."
A medical doctor, Drew studied for seven years in Cuba and said friends there have told him of food scarcity, power outages and garbage strewn in the streets.
"I can only feel the pain of those who treated me so well when I was a student," he said.
The United States has imposed sanctions on Cuba almost continuously since Fidel Castro's 1959 revolution.
Since becoming the top US diplomat, Rubio has publicly toned down calls for regime change, and Washington has quietly held discussions with Havana.
Trump and Rubio have threatened sanctions against countries that sell oil to Cuba but stopped short of enacting some measures pushed by Cuban-American hardline critics of Havana, such as prohibiting the transfer of remittances.
'Elephant in the room'
Kamla Persad-Bissessar, the prime minister of Trinidad and Tobago, said she empathized with the Cuban people but took issue with her Jamaican counterpart's remarks.
"We cannot advocate for others to live under communism and dictatorship," she said.
She also criticized CARICOM countries for their reticence, at least publicly, to back what she called the "elephant in the room" -- US intervention in Venezuela.
Trinidad and Tobago, whose coast is visible from Venezuela, gave access to the US military in the run-up to the operation that removed Maduro.
The deposed Venezuelan leader faces US charges of narco-trafficking, which he denies.
Persad-Bissessar thanked Trump, Rubio "and the US military... for standing firm against narco-trafficking, human and arms smuggling."
The Trump administration has been carrying out deadly strikes against alleged drug boats in the Caribbean, drawing criticism by those who say the attacks are legally and ethically dubious.
The Trinidadian prime minister praised the US approach and credited it with bringing down her country's homicide rate by helping cut the flow of firearms from Venezuela.
