U.S. Threads the Needle to Reinstate Venezuelan Oil

Venezuelan President Maduro and the country’s opposition are expected to resume talks as the United States eased some sanctions to make it easier for the negotiations. Biden Administration authorized Chevron, the last U.S. oil company with a presence in Venezuela, to open talks with the Maduro government, temporarily lifting restrictions on such discussions.

Washington has not decided whether to renew Chevron’s limited license to operate in Venezuela. Chevron is the last U.S. company to maintain a presence in the Latin American nation, home to the world’s largest crude reserves.

The U.S. has also been contemplating to remove sanctions on two individuals: Venezuela’s first lady and a former official of the PDVSA,  the country’s state run oil company.

Last March, a U.S. delegation has visited Caracas to hold talks with the Venezuela government, leading to the release of two detainees. During the talks, Maduro requested the U.S. to lift sanctions on the former PDVSA official.

Maduro also expressed willingness to return to the negotiating table with the opposition in Mexico. The Venezuelan leader had left the negotiations in October. The sides are expected to set a date soon to resume talks.

The talks are expected to end Venezuela’s long standing political crisis, and Washington insists any major lifting of sanctions will depend on progress at the table. The United States has recognized opposition leader Juan Guaido as legitimate president, labeling Maduro’s 2018 re-election as fraudulent. Maduro remains in power.

The Biden Administration has also announced its revised Cuba policy, easing some Trump era restriction.

The U.S. prepares to host the Summit of the Americas in Los Angeles in June. Leaders of Mexico and Bolivia threatened to boycott the summit if Cuba, Nicaragua and Venezuela’s governments are excluded. U.S. officials claim there is no connection between the summit and the Venezuela-Cuba policy revisions.

The U.S. authorization to Chevron to resume talks with PDVSA is a rather narrow one and will not go beyond the discussion of potential future activities. It does not allow Chevron to enter any agreement with PDVSA or any other activity involving PDVSA.

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