Ramping up pressure to unseat the government of President Nicolas Maduro, the Trump administration Monday took the long-awaited step of sanctioning Venezuela’s oil company, that country’s lifeline, and saying it will divert revenue to the party of his chief opponent, Juan Guaido.
The sanctions will block and seize $7 billion in Venezuelan assets, administration officials said.
The administration stopped short of an all-out embargo on Venezuelan oil, much of which is processed in U.S. refineries and supplies numerous Caribbean and Central American countries.
“Any purchase of Venezuelan oil by U.S. companies … will have to go into blocked accounts,” Treasury Secretary Steven T. Mnuchin said at a White House news conference.
The sanctions target the state-owned Venezuelan oil company Petroleos de Venezuela SA, known as PdVSA, and will prevent Maduro from using profits for his own benefit, Mnuchin said.
“Today’s designation of PdVSA will help prevent further diverting of Venezuela’s assets by Maduro and preserve these assets for the people of Venezuela,” Mnuchin said. “The path to sanctions relief for PdVSA is through the expeditious transfer of control to the interim president or a subsequent, democratically elected government.”
The U.S. and other countries last week recognized Guaido, the head of the Venezuelan opposition who declared himself president, as the rightful leader of the country. Russia, China and Mexico opposed the move.
President Trump’s national security advisor John Bolton, who joined Mnuchin for the announcement, said the oil company had long served as a “vehicle for corruption” that embezzled billions of dollars for the “personal gain” of Maduro and other corrupt Venezuelan officials.
In a long string of economic sanctions that the U.S. has slapped on Maduro and his government in the last two years, Washington had avoided touching the oil industry because of possible disruption to the world market. On Monday, Mnuchin and Bolton said they were confident that Middle East nations would be able to make up for any shortfall in oil supplies.
For more on international affairs, follow @TracyKWilkinson on Twitter