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Washington Says will Ease Venezuela Oil, Gas Sanctions After Election Deal

The United States will ease some oil and gas sanctions against Venezuela after the country’s government and opposition agreed to hold elections there next year, the Treasury Department said Wednesday

In response to those “democratic developments,” the Treasury “has issued General Licenses authorizing transactions involving Venezuela’s oil and gas sector and gold sector, as well as removing the ban on secondary trading,” a statement from under secretary for terrorism Brian Nelson said.

It added, however, that they could be amended or revoked at any time if the electoral deal falls through.

In concrete terms, the US government is re-authorizing the purchase of Venezuelan oil and gas for a period of six months, which may be renewed “only if Venezuela meets its commitments under the electoral roadmap as well as other commitments with respect to those who are wrongfully detained.”

Regarding the gold sector, no time limit has been specified, with the Treasury Department stating it seeks to reduce black market trading.

Washington is also allowing renewed trading in Venezuelan debt securities on the secondary market, although the ban on the primary market — meaning debt securities newly issued by the Venezuelan government — remains in force.

The easing of sanctions on Venezuelan oil had been eagerly awaited by the markets, leading to a fall in the price per barrel despite the war between Israel and Hamas and the risk of escalation in the Middle East.

The United States had already flagged the possibility of easing the sanctions, and the announcement Tuesday that Venezuela’s government and opposition had agreed to elections ramped up speculation.

An exact election date will be defined by the country’s National Electoral Council, according to the text of the deal.

The two sides had resumed talks seeking to end the country’s political and economic crisis, after a nearly yearlong suspension.

The opposition, backed by several countries including the United States, did not recognize President Nicolas Maduro‘s 2018 re-election in a vote widely dismissed as fraudulent.

The following year, Washington ramped up sanctions against Caracas first imposed in 2015 over the brutal repression of anti-government protests.

But the energy crisis sparked by Russia’s war on Ukraine saw renewed global efforts to solve the crisis in Venezuela, which has the world’s largest oil reserves.

Last year, US delegates went to Caracas to meet Maduro, even though it does not recognize him as a legitimate leader.

After initial talks between the government and the opposition, Washington granted a six-month license to US energy giant Chevron.

Source: France 24