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Oil may be the gateway to kicking Venezuelan sanctions

The looming energy crisis seems to have Biden thinking more clearly about the status quo when it comes to Nicholas Maduro.

Analysis | Latin America

According to recent reports, the Biden administration may be making some changes to U.S. Venezuela policy, including the possible easing of oil sanctions and the creation of a limited humanitarian program to assist Venezuelan migrants.

While there have been no changes yet, the Biden administration may be starting to recognize that it cannot continue with the status quo inherited from Trump if it wants to bring more oil on the market and provide some relief to the people of Venezuela.

Venezuela policy has been crying out for a major overhaul for years, and President Biden should seize this opportunity to break with one of the most harmful legacies of his predecessor. To make the most of this opportunity, the president will need to go beyond such small tentative steps and dismantle the broad sanctions that the U.S. has been imposing on Venezuela in pursuit of regime change.

If it happens, the proposed easing of sanctions would be modest and would take the form of permitting Chevron to resume oil exports from Venezuela. This would not produce a huge amount of oil, but it would help to offset the OPEC+ production cut that has roiled U.S. relations with its clients in the Persian Gulf. Any sanctions relief would help to stabilize Venezuela’s battered economy, and that might reduce the pressure on Venezuelans to leave their country in such large numbers.

Scaling back the economic war on Venezuela would benefit ordinary Venezuelans, and it would also help the U.S. manage the surge of migrants seeking entry into the U.S. and provide some assistance in reducing energy prices. If that relief can facilitate a resumption of political negotiations between Maduro and Venezuelan opposition leaders, it might offer the beginning of a path out of the political and humanitarian crisis that has wrecked Venezuela over the last decade.

It is still not certain that any of these changes will take place. Secretary of State Antony Blinken made a point of downplaying the latest reports, saying, “We will review our sanctions policies in response to constructive steps from the regime.” Making the review of U.S. sanctions conditional on what the targeted government does is typical, and it is why sanctions policies remain in force long after they have been proven to be useless. Instead of waiting on a targeted government to take “constructive steps” that may never come, broad U.S. sanctions need to be reviewed regularly and removed if they are failing to achieve their stated purpose. 

In fact, the U.S. should provide much more extensive sanctions relief than the administration is currently considering. The administration is reportedly “debating how to engage with [Maduro] without legitimizing or helping perpetuate his rule,” as the Times report puts it, but it should be clear by now that Maduro’s grip on power has only tightened as the sanctions pressure has increased. The administration should not fear helping to perpetuate Maduro’s rule by engaging with him. The sanctions have already been helping to do that more than any meetings with U.S. officials ever could. 

It may seem counterintuitive, but the leaders of heavily sanctioned states usually become more entrenched in their positions because worsening economic conditions weaken their domestic opposition and make the population more dependent on the government. Insofar as the opposition has been identified with the “maximum pressure” campaign, it has damaged their political standing. While supporters of the policy present broad sanctions as a means to weaken Maduro, the reality is that the sanctions have created conditions in which Maduro is now more firmly in control than before. 

There is growing recognition in Washington that the “maximum pressure” campaign against Venezuela has run into a dead end. Last week, Sen. Chris Murphy (D-CT) acknowledged that sanctions have not achieved anything: “Just in case you haven’t noticed, our policy of sanctioning and isolating Maduro hasn’t worked. At some point when your policy isn’t getting results, it’s malpractice to not try something else.”

The failure to compel Maduro to cede power has come at a great cost to the people of Venezuela, who have been made to bear the burden of economic warfare waged against their country, and the U.S.-backed opposition leader Juan Guaidó is farther away from taking office than ever. Most U.S. partner governments stopped recognizing Guaidó as Venezuela’s interim president more than a year ago, and the new administration of Colombian President Gustavo Petro has switched his government’s formal diplomatic recognition back to Maduro. It is long past time for the U.S. to drop the pretense that Guaidó is the head of Venezuela’s government. 

William Neuman, author of Things Are Never So Bad That They Can’t Get Worse: Inside The Collapse of Venezuela, recently made the case for facing political reality in Venezuela and accepting that the U.S. must deal with the de facto president in Maduro. As Neuman explains, giving up on Guaidó need not mean giving up on the Venezuelan opposition. He writes:

“But by continuing to uphold the fiction that Mr. Guaidó is president of Venezuela, the administration makes it harder for the opposition to go through the necessary process of reforming itself. The United States must acknowledge reality — as it relates to who actually governs in Venezuela and the need for Venezuelans to fashion the opposition that they choose. That is the only way that Washington can play a constructive role in solving Venezuela’s crisis.”

The UN estimates that nearly seven million people have left the country in the last eight years. The exodus of Venezuelan migrants is the largest refugee crisis in our hemisphere, and the only crises that compare to it elsewhere in the world are those that have been created by major wars. That is why it was welcome news that the Biden administration is considering creating a humanitarian parole system for Venezuelans, but on closer inspection the new program would do very little to address the issue. The program would aid tens of thousands of Venezuelans, but this is a drop in the bucket when we consider the scale of the crisis.

There will be no solution to the refugee crisis without alleviating Venezuela’s severe economic and humanitarian crises, and this is where substantial sanctions relief can help. Because broad sanctions have exacerbated Venezuela’s economic woes and contributed to the country’s food insecurity, keeping these sanctions in place ensures that living conditions will remain dire. U.S. policy cannot fix the Venezuelan government’s mismanagement and corruption, but it can stop worsening the plight of tens of millions of people by lifting the sanctions that were so carelessly imposed in the attempt to force a change in government.

Image: YAKOBCHUK V via
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