Benzinga - by Piero Cingari, Benzinga Staff Writer.
In light of the 2024 election deal between the Venezuelan government and its opposition, there are reports suggesting that the Biden administration is getting ready to ease sanctions on Venezuela’s oil and gas sector.
What Happened: This development comes after an anonymous senior official from the U.S. State Department informed Reuters of the U.S.’ intention to relax restrictions related to Venezuela’s energy sector.
However, it’s important to note that the official issued a cautionary statement, suggesting that these measures could be reversed if President Nicolas Maduro‘s government fails to lift the bans on opposition presidential candidates and release political prisoners.
Why It Matters: The easing of sanctions against Venezuela signifies a significant shift in U.S. foreign policy. It demonstrates the Biden administration’s willingness to negotiate with regimes it has previously criticized, providing they show a commitment towards democratic reforms. The impact on oil prices also highlights the broad economic implications of geopolitical decisions.
This updated stance is in stark contrast to the “maximum pressure” campaign employed by former President Donald Trump against the socialist-led OPEC-member country. The decision to ease sanctions comes after an agreement was reached in Barbados on Tuesday.
This accord, involving Maduro’s administration and the U.S.-backed opposition, commits to providing electoral assurances for a vote scheduled to be internationally monitored in the upcoming year.
The agreement, however, did not meet U.S. expectations, as it did not lift the bans on opposition candidates disqualified from holding public office or arrange for the release of political prisoners.
Oil prices were 1% higher as of 03:00 p.m. in New York, with the WTI benchmark trading at $87.25 per barrel. The United States Oil Fund (NYSE:USO) was up 1.6% to $80 per share.
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