The United States announced on Wednesday that it would partially reverse the relief of sanctions against Venezuela’s oil and gas sector. This decision was made due to accusations against Venezuelan dictator Nicolás Maduro for not fulfilling his electoral commitments by disabling the main opposition candidate, María Corina Machado. The Treasury Department decided not to renew the relief, which expires at midnight on the same day, and set a deadline of May 31 for foreign companies to cease all operations related to Venezuelan oil and gas production.
Companies that wish to conduct business with the state-owned Petróleos de Venezuela (PDVSA) must now request individual authorizations from the US Treasury, which will be evaluated on a case-by-case basis. The US government had previously issued General License 44 as an incentive for Maduro to comply with the Barbados Agreements signed with the opposition, aiming for democratic and competitive elections. However, due to Machado’s disqualification from running in the July elections, the relief of sanctions has been reversed.
The sanctions relief allowed Caracas to expand business with foreign companies, resulting in an increase of 18% in oil production in the first quarter of the year. Despite the reimposition of sanctions, the US is still engaged in talks with representatives of Maduro, the opposition, and other governments to salvage the Barbados Agreements. The decision to reverse the relief of sanctions has sparked debates within the Biden administration regarding potential impacts on migration and gasoline prices.