US To Soften Sanctions On Venezuelan Oil In Exchange For Fair Elections

In a diplomatic turn, the U.S. and Venezuela have crafted an agreement to address longstanding tensions. Under the agreement, the U.S. plans to soften sanctions on Venezuela’s oil sector, and in exchange, President Nicolás Maduro promises an internationally supervised, competitive presidential election in 2024.

The deal is set for formalization in Barbados this week, with U.S. officials expected to attend. Maduro’s 2018 election, widely criticized as rigged, stands as a backdrop to these negotiations. Maduro has now signaled a willingness to ease restrictions on opposition candidates, although the timeline for such moves remains uncertain.

While this agreement is notable, it doesn’t encompass the release of political prisoners in Venezuela or address the status of frozen Venezuelan assets in the U.S. Importantly, the U.S. is expected to impose a timeframe on the sanction reliefs, allowing for their reinstatement if Maduro reneges on his commitments.

Focusing on the oil implications, all I'll say re: Maduro is that it's extremely unlikely he would willingly give up power. Obviously that is the key factor.

But confirms the view that the US is determined to get as much oil on the market as it possibly can. That's the upshot.

— Gregory Brew (@gbrew24) October 16, 2023

Maduro’s pledges also extend to welcoming international electoral observers and enhancing media access for the forthcoming elections. If the deal is finalized, the U.S. could ease certain oil sanctions, potentially allowing Venezuela’s state-owned oil agency to resume business with the U.S.

This potential thaw in relations is timely. Venezuela’s opposition is gearing up for primary elections, and the favorite, María Corina Machado, remains prohibited from running due to Maduro’s restrictions.

U.S. sanctions on Venezuela intensified in 2019 following Maduro’s contested election. However, recent moves, like the U.S.’ decision to resume direct deportation flights to Venezuela, hint at a warming of ties between the two nations.

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