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US to ease oil sanctions on Venezuela in election deal

October 19, 2023

The United States is easing sanctions on the Venezuelan oil and gas sector after the government agreed with opposition figures to hold elections next year.

Towers and oil platforms of the Venezuelan state oil company PDVSA are observed on the shores of Lake Maracaibo
Venezuela has the world's largest reserves of oilImage: Jose Isaac Bula Urrutia/Eyepix/ZUMAPRESS/picture alliance

The United States announced on Wednesday that it would provide temporary limited relief to sanctions on Venezuela's oil and gas sector in response to a 2024 election deal reached between the Venezuelan government and the country's opposition, the Treasury Department said.

The relief is subject to change if Venezuela fails to comply, the US Treasury Department said.

Biden relieves sanctions on Venezuelan oil 

"In response to these democratic developments, the US Department of the Treasury has issued General Licenses authorizing transactions involving Venezuela's oil and gas sector and gold sector, as well as removing the ban on secondary trading," the Treasury Department said.

The administration under President Joe Biden, who had long promised sanctions relief in return for democratic concessions from Maduro, decided to issue licenses and authorizations that will also allow Caracas to resume business with Caribbean nations.

The move marks a significant step in the Biden administration's steady shift toward increased engagement with Venezuela.

The US is moving away from former President Donald Trump's "maximum pressure" campaign against the socialist-governed OPEC-member state.

What does the election deal mean?

On Tuesday, Venezuela's government and the US-backed opposition reached a deal on electoral guarantees for an internationally monitored vote to be held in the second half of next year.

"This is the first step in a much broader agreement," the head of the government delegation Jorge Rodriguez said. Opposition representative Gerardo Blyde, called the agreement a "solid step" forward.

But the deal did not remove bans on opposition candidates the government had barred them from public office and made no mention of freeing political prisoners, falling short of what the US wanted to see.

Venezuela has the world's largest reserves of oil. After the Russian full-scale invasion of Ukraine and the subsequent energy crisis, international interest in easing the political deadlock in Venezuela has been growing.

dh/jcg,ab (Reuters, EFE, AFP)