Biden eases Venezuela oil embargo after Maduro signs election deal

The Biden administration eased oil, gas and gold sanctions against Venezuela on Wednesday, a day after President Nicolas Maduro’s government and the US-backed opposition agreed to terms for a contested presidential election next year.

The Treasury Department issued a general license authorizing U.S. companies to engage in long-prohibited transactions, primarily in the state-controlled energy sector. It said the license would be valid for six months and would only be renewed if the totalitarian socialist government “fulfills its promises” for the election and “in relation to those wrongly detained”.

The agreement signed by government and opposition politicians on Tuesday could be a breakthrough in the South American country’s political deadlock, following years of back-and-forth negotiations. The Biden administration has promised to consider suspending some sanctions in exchange for progress.

The planned election deal and sanctions relief were first reported this week by the Washington Post. Administration officials, who have long insisted that the talks are only between Venezuelans, denied on Monday that any US sanctions “deal” was part of the package.

The United States has decided to ease sanctions on Venezuela in preparation for free presidential elections next year

Secretary of State Anthony J. Blinken said Wednesday. Other restrictions, he said in a statement, will remain.

Blinken said the U.S. “expressed our expectation and understanding” that by the end of November, Maduro would define a specific timeline and process for the swift reinstatement of all candidates in the upcoming elections, including “all those who want to run for president” next year, and “level the electoral field.”

Venezuela will “begin the release of all wrongfully detained US citizens and Venezuelan political prisoners,” he said.

Four Americans are known to be detained in Venezuela. They include Luke Denman and Iron Perry, who were arrested in 2020 for their alleged involvement in a failed attempt to take over Maduro. Eivin Hernandez, who entered Venezuela while on vacation, is charged with criminal association and conspiracy. Jerrel Kenmore, 52, was detained by immigration officials when he entered the country with his Venezuelan girlfriend.

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More than 250 Venezuelans are currently detained for political reasons, according to human rights group Foro Penal.

A senior administration official said the U.S. move would not affect lawsuits by creditors in U.S. courts involving CITGO, PDVSA-owned oil refining and marketing firm CITGO, or Venezuelan assets frozen in the U.S. or elsewhere. The official spoke on condition of anonymity under rules imposed by the administration.

Maduro’s government pledged on Tuesday to allow all parties to choose their candidates, allow international observers to monitor voting and provide fair media access to all campaigns. Now the government has not promised to remove the barriers that prevent some opposition candidates from contesting.

Maduro, speaking during a televised meeting with members of his government in talks with the opposition on Wednesday evening, said the lifting of the oil embargo was a “victory for the country” and the result of negotiations with the United States.

“This path will lead to the complete lifting of sanctions against Venezuela,” he said. “We’re people of our word. What’s written and signed comes to pass. … With this license, we’re moving forward step by step.

The Treasury Department amended licenses to lift a secondary trading ban on some Venezuelan sovereign bonds, including debt and shares of state-controlled oil company PDVSA. “We estimate that this will have a positive effect on the removal of restrictions on the state gold mining company, displacing the worst players in this market and minimal financial gain for the authorities from Venezuela,” the Treasury said.

Maduro, who was elected to succeed Hugo Chavez, who founded Venezuela’s socialist state, claimed victory in a 2018 election deemed rigged by the United States and other countries.

The Trump administration severed ties with the government in 2019, adding to existing sanctions that block Venezuela’s access to U.S. financial markets. President Donald Trump has at times threatened military action against Venezuela, which he accuses of conspiring against the United States with Russia and Iran, with which Maduro maintains close ties. Iranian President Ibrahim Raisi visited Caracas last summer on his first trip to Latin America.

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Venezuela has the world’s largest proven oil reserves, but years of mismanagement and sanctions on the oil sector have brought the economy to a near standstill. More than 7 million Venezuelans — a quarter of the population — have fled the country. Many now live in other South American countries, and nearly 500,000 have crossed the US southern border in the past three years; They include about 50,000 people arrested by US agents last month.

In another result of the talks between Washington and Caracas, the United States conducted its first deportation flight to Venezuela on Wednesday, repatriating nearly 130 migrants.

Herrero reported from Caracas, Venezuela.

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