Reuters reports five sources familiar with the matter as saying that officials in Washington are preparing a proposal that would ease the restrictions on the oil industry of Venezuela in return for the country making moves to hold a presidential election that can be regarded as being “free and fair.”
The US-imposed sanctions on Venezuela followed the re-election of President Nicolas Maduro in what was considered a sham election by many Western countries. Since then, only Chevron, the maker of Texaco lubricant and grease products, has received authorisation to resume its joint venture operations there, under the condition that the state-owned PDVSA’s share of any crude oil sales is used to pay off its debt to Chevron.
Whilst talks between Maduro and opposition leaders have thus failed to come to a constructive agreement, US government officials are reportedly preparing a pitch to break the deadlock. It is thought that this will propose that more buyers will be able access Venezuelan crude in a structured manner, if Maduro makes the necessary steps to start re-establishing democratic processes.
A US National Security Council spokesperson stated:
“Should Venezuela take concrete actions toward restoring democracy, leading to free and fair elections, we are prepared to provide corresponding sanctions relief.”
Venezuelan heavy crude is particularly valued by US refiners on the Gulf Coast who have, until recently, substituted it with heavy Russian crude. Having more crude from Venezuela on the market will help address the current shortage of heavy crude.
