US mulls easing sanctions on Venezuela as migration rises


There is growing pressure within the Biden administration to reshape relations with oil-rich Venezuela, as officials seek to contain the migration crush on the southern border and make progress in the energy war. against Russia.

The talks, which U.S. officials say revolve around resuming Venezuela’s oil exports if the country takes steps to restore democracy, could spark a major diplomatic shift with America’s staunchest adversary in South America.

Since President Biden took office, the administration has signaled openness to rapprochement with Venezuela in return for democratic openness, in part because some U.S. officials believe a purely hard-line approach has failed to move the government of President Nicolás Maduro away from autocracy.

But there is growing pressure on the administration to work out a deal, analysts say, after the world’s biggest oil producers decided to cut production this month and with the surge of Venezuelan migration to the United States.

In an attempt to overthrow Mr Maduro, President Donald J. Trump in 2019 banned all Venezuelan oil exports and blacklisted the country’s state oil company, effectively imposing an embargo on the country that owns the largest proven oil reserves in the world.

Today, the administration moves closer to authorizing Chevron, the last U.S. company producing oil in Venezuela, to resume exports if Maduro’s government agrees to take meaningful steps to ease the country’s humanitarian crisis. and officially resume negotiations with the country’s opposition, according to a senior Biden administration official and two people familiar with the matter who were not authorized to speak publicly.

So many Venezuelans are migrating that the number intercepted at the US border from October 2021 to August has reached more than 150,000, a huge increase from previous years.

To deal with the increase, the administration is considering a humanitarian parole program for some Venezuelan migrants, similar to that offered to Ukrainians.

But some U.S. officials also say lifting sanctions on Venezuela’s already precarious economy could help stabilize the country and ultimately stem the flow of Venezuelans leaving.

Because the United States ended diplomatic relations with the Maduro government in 2019, Venezuelan migrants cannot be easily returned – a main reason why they arrive at the border in waves, experts say.

“It’s a huge crisis now,” said Michael Penfold, a Venezuela-based researcher at the Wilson Center, a Washington-based policy group. “They look at this with dismay and realize that they have to bring some sort of solution to Venezuela,” he added, referring to the administration.

Speaking to reporters last week in Lima, Peru, Secretary of State Antony J. Blinken said “there was no change” in the administration’s policy toward Venezuela, but added “We will review our policies, including our sanctions policies, in response to steps taken by the Maduro regime to restore democracy.

Mr. Biden inherited from the Trump administration a near-total ban on Chevron operations, which allows the California-based company to perform only basic maintenance at its four Venezuelan oil fields.

Trump officials, led by national security adviser John Bolton, actively plotted to overthrow Mr Maduro and hoped in vain that starving his regime of money might achieve that.

Mr. Biden has maintained Trump’s sanctions despite complaints in the United States that they are causing humanitarian suffering, while doing little to threaten Mr. Maduro, who, with the help of allies like Iran and Russia , has built alternative oil export routes to Asia.

But any semblance of reconciliation with Mr Maduro risks angering some American voters, and the administration is debating how to engage with the autocratic leader without legitimizing or helping to perpetuate his rule. A March trip to meet with the government in Caracas — the first high-level U.S. government visit to Venezuela in years — has been criticized by lawmakers from both parties.

Earlier this month, the administration shocked the Venezuelan diaspora by freeing two of Mr Maduro’s step-nephews, who were serving prison sentences in the United States for major drug convictions, in exchange for seven Americans imprisoned in Venezuela. But the move has led some analysts to speculate that Biden officials are starting to take more political risks to break the diplomatic deadlock.

The question facing the administration in easing the Venezuelan oil embargo is what to do with the revenue that Chevron and other foreign companies in the country would generate. Under normal conditions, the windfall would be shared between private companies and PDVSA, the Venezuelan state oil company.

But the US government doesn’t want to see the money flow into Mr Maduro’s pockets, so officials have considered other ways to distribute the oil revenue.

One option being explored by US officials is to channel oil revenues into a trust fund that would finance humanitarian activities in the country.

The idea has precedent in the administration’s policy towards Afghanistan after the Taliban takeover last year. After initially freezing about $7 billion in Afghan funds, the administration eventually transferred about half of those reserves to an account managed by a Swiss foundation to be spent on improving conditions in Afghanistan without benefiting the Taliban.

Another possibility is to allow PDVSA to use oil export revenues to reduce its debts to Chevron, said Francisco Monaldi, a Venezuelan oil expert at Rice University in Houston. The administration authorized a similar arrangement this summer for two European oil companies, Repsol and Eni.

Chevron’s operations in Venezuela could bring up to 100,000 barrels per day to the oil market, which is just 1% of daily US oil imports. Still, some U.S. officials and analysts say it could help calm a volatile global energy market by signaling that more supplies may be on the way.

Gas prices in the United States, after months of decline, have started to rise following a decision last week by the world’s largest oil producers, led by Saudi Arabia and Russia, drastically reduce production.

It is unclear whether Mr Maduro would have much incentive to agree to an arrangement where his government does not share the profits from oil exports. After crushing opposition and staging a modest economic recovery, the Venezuelan autocrat remains firmly in control despite sanctions and has little reason to meet U.S. demands, analysts said.

“He learned to survive,” said Félix Seijas, a prominent Venezuelan pollster. “He won’t hand over anything that threatens his loss of power.”

With Mr. Maduro holding most of the cards, simply allowing Chevron to get paid without providing a direct financial benefit to the Venezuelan government might not be enough to induce the authoritarian leader to agree to Democratic concessions, Mr. Monaldi said. oil expert.

Envoys from Mr Maduro and the Venezuelan opposition met in Mexico City last year for the latest round of talks aimed at resolving the country’s political impasse – but Mr Maduro ended the talks after just one meeting.

The Maduro government and the opposition have discussed how to deal with the humanitarian emergency in the country and appear close to reaching an agreement, according to US officials and the Venezuelan opposition.

Some in Washington say the political environment may soon allow for a softer approach to Venezuela, especially after the midterm elections. If Florida remains firmly controlled by Republicans, as pollsters predict, Biden advisers may see less harm in angering the state’s large Venezuelan diaspora by engaging with Mr. Maduro’s government.

A changing political reality in Latin America could also push the administration to review its policy toward Venezuela, analysts say. For years, Mr Maduro’s neighbors absorbed millions of Venezuelans, effectively containing the bulk of the exodus before it reached the United States.

But after the pandemic hit economies in the region, Venezuelan immigrants struggled to find jobs in host countries like Colombia and Ecuador. In record numbers, they crossed one of the most dangerous jungles in the world, between South America and Panama, trying to reach the United States border.

The election of left-wing leaders in key South American countries has led to more vocal calls for a change in the region’s approach to Venezuela. Gustavo Petro, Colombia’s new leftist president, recently normalized diplomatic relations with Mr Maduro, a major political break from his predecessor.

A senior Biden administration official said Mr. Petro may soon begin demanding that the United States lift sanctions on Venezuela to help stabilize the neighboring country with which he shares critical security interests. economy and migration.

“There is a growing realization that there needs to be a shift in US policy toward Venezuela,” said Dany Bahar, a Venezuelan migration expert at Brown University in Rhode Island. “You can no longer ignore that it was a failure.”

Michael Crowley, Genevieve Glatsky and Isayen Herrera contributed report.