President Joe Biden has just reversed the sanctions that former President Donald Trump had placed on Venezuela, the Associated Press reports.
Trump and his administration had imposed sanctions on Venezuela as part of a “maximum pressure” strategy that was a response to the socialist government’s corruption. Trump, in part, imposed sanctions on Venezuela’s oil.
But, recently, reports emerged suggesting that Biden might be looking to make a deal with Venezuela, a deal that could reverse Trump’s approach, and that’s what has now happened.
The deal
The Wall Street Journal reported the likely details of the deal over the weekend.
In brief, the deal would grant Chevron Corp. a license to pump oil in Venezuela in exchange for some humanitarian-type commitments from Venezuela.
Per the Journal:
Granting the new license is contingent on the Venezuelan government and its political opponents’ announcement, expected Saturday, to implement a $3 billion humanitarian program using Venezuelan funds unfrozen by the U.S. as well as an agreement to resume talks in Mexico City next month on resolving the country’s political crisis through free and fair elections, people familiar with the matter said. The talks would quickly set in motion U.S. authorization for Chevron’s return to Venezuela’s oil fields, according to the people.
The Journal, in its report, suggested that all parties were on board, and so, it was expected that the deal was imminent, and it was.
It’s official
The Associated Press reports that Venezuela and the United States entered into the deal on Saturday.
The outlet reports:
On Saturday, Venezuela’s government and its opposition agreed to create a U.N.-managed fund to finance health, food, and education programs for the poor, while the Biden administration eased some oil sanctions on the country in an effort to boost the newly restarted talks between the sides.
So, Venezuela will have its funds unfrozen and Chevron will get to pump oil in exchange for Venezuela’s commitment to pursue humanitarian objectives. It is, more or less, a complete reversal of Trump’s policy.
What’s in it for the U.S.?
This, of course, is the key question, and the obvious answer would appear to be oil.
America has been facing an energy crisis that has seen the prices of gas and oil skyrocket, and Biden has been looking for ways to appease Americans while not upsetting the climate change crowd. Maybe this is it – or not.
The Journal reports that “some analysts have said Venezuela’s oil production is likely to hit a ceiling of about 1 million barrels a day in the medium term.”
This brings us back to the question, “what is in it for America?” And, at the moment, the answer is not immediately apparent.