The U.S. ordered Chevron to halt operations in Venezuela within 30 days, impacting the Maduro government’s revenue stream. The decision reflects a shift in Trump’s approach, moving from engagement to sanctions due to Venezuela’s failure to conduct fair elections. Experts warn of severe economic consequences, including recession and increased emigration.
On Tuesday, the U.S. government mandated Chevron to cease its operations in Venezuela within a month, significantly impacting the financially struggling Venezuelan government. Chevron currently plays a crucial role, producing and exporting nearly a quarter of Venezuela’s crude oil, which is essential for generating revenue for President Nicolas Maduro’s administration.
The Treasury Department issued the order, stating Chevron must halt its oil extraction within 30 days—an unrealistic timeline according to industry experts. This decision marks a notable shift in former President Trump’s approach to Venezuela, which had previously involved strict sanctions aimed at the Maduro regime.
During his initial term, Trump adopted a policy of maximum pressure against Maduro’s government, implementing sanctions and severely restricting U.S. oil companies’ operations. However, upon returning to office, he initially sought engagement with Venezuela, sanctioning agreements for the release of U.S. citizens in exchange for repatriating Venezuelan migrants.
Trump’s more conciliatory stance faced backlash from Florida Republicans advocating for support of pro-democracy factions in Venezuela. Subsequently, in response to Venezuela’s failure to fulfill election commitments, Trump reversed his previous engagement approach and reiterated support for sanctions against the Maduro regime.
Experts indicate that stopping Chevron’s operations could trigger a recession in Venezuela, leading to further emigration from the country. The loss of Chevron-related revenues could diminish foreign reserves by approximately $150-200 million monthly, exacerbating Venezuela’s existing economic difficulties.
Vice President Delcy Rodriguez accused the U.S. of inflicting self-harm by worsening conditions for Venezuelans. She stated, “The new US government is trying to hurt the Venezuelan people. It’s a self-inflicted blow that is going to increase fuel prices.”
Although oil markets reacted calmly to the news amid OPEC’s production increase, Chevron’s stock price saw a decline of about 2.8% in the past week. Venezuela, once producing 3.5 million barrels of oil a day, now only manages just over one million barrels, strained by longstanding sanctions and declining price levels.
In summary, the U.S. has ordered Chevron to stop operations in Venezuela within a month, a decision that may lead to severe economic consequences for the nation. This represents a significant reversal in Trump’s policy towards Venezuela, moving from engagement back to sanctions amidst claims of electoral fraud. Experts predict dire repercussions for both the Venezuelan economy and the populace. The situation highlights the complex interplay between U.S. foreign policy and the internal dynamics of Venezuela, potentially resulting in increased instability and migration.
Original Source: www.rnz.co.nz
