US reimposes sanctions on Venezuelan oil

Washington has reimposed sanctions on the Venezuelan oil and gas sector on 18 April, the US Department of State (DOS) stated.

PHOTO: Oil barrels with the Venezuelan flag and pumpjacks in the background. Getty Images

The US government scrapped its “limited sanctions relief” deal on Venezuela after the country’s government led by President Nicolás Maduro failed to fully meet the commitments made regarding holding fair presidential elections in the second half of this year.

The US government had issued a six-month general license to produce, sell, and export Venezuelan crude and gas to selected markets in October 2023, after Maduro signed a partial roadmap to host elections in the country.

“Maduro and his representatives prevented the democratic opposition from registering the candidate of their choice…We again call on Maduro to allow all candidates and parties to participate in the electoral process and release all political prisoners without restrictions or delay,” DOS noted.

The US has given a 45-day window to Venezuela as a “wind-down license” to gradually cease all operations, DOS said.  

With the reinstatement of sanctions on the OPEC+ member, and additional supply-related concerns arising from output cuts within the broader group, Brent crude futures might see a significant surge in prices this year.

“The US announced it has reinstated sanctions on Venezuela’s oil industry, which could disrupt its 600,000 b/d exports,” said ANZ Bank’s senior commodity strategist Daniel Hynes.

Venezuela produced around 809,000 b/d of crude oil in March, according to OPEC’s latest oil market report. The country can produce about 3.2 million b/d of crude, according to the US Energy Information Administration (EIA).

By Aparupa Mazumder 

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