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The fall of Maduro's empire? The US is preparing a study that could cut 30% of Venezuela's oil revenues and shake the dictatorship!
The White House has begun a technical-political study to determine whether the abrupt drop in hydrocarbon production in Venezuela affects the dictatorship, impacts the economy North American and shakes the energy market. This is a decision against time: Maduro intends to take office on January 10, 2025.
Chevron’s dilemma and dialogue with the Venezuelan opposition
(From Washington, United States) The White House is considering suspending Chevron's license, which authorizes the company to extract oil in Venezuela, as a way to force dialogue between dictator Nicolás Maduro and the political opposition. The aim is to allow Edmundo González Urrutia to return from exile in Spain to assume the presidency on January 10, 2025.
The Biden administration has already imposed legal, financial and diplomatic sanctions against the entire structure of the populist regime, but this strategy to prevent electoral fraud and the constant violation of human rights has had little impact. Maduro's state and para-state troops have tortured and killed dozens of opponents in Venezuela, and González Urrutia, a presidential candidate, had to flee to Madrid for fear of an illegal arrest ordered by the justice system, which responds to the dictatorial regime.
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The technical-political study of the United States
In this context, the National Security Council, the State Department and the Department of Energy of the United States began an in-depth technical-political study to assess whether the suspension of the oil extraction license granted to Chevron could serve as a lever to open a negotiation process, culminating in the inauguration of González Urrutia as president of Venezuela.
Chevron, Maduro and the Venezuelan opposition – represented by González Urrutia and María Corina Machado – already know that the Biden administration is considering suspending the oil extraction license, which began in 2022 and has been renewed without problems every six months.
Impacts of Chevron's License Suspension
“Are measures beyond individual sanctions being considered that would affect Venezuela’s oil sector? For example, restrictions on the oil company’s oil license, Chevron or other foreign companies already operating in the country are being discussed?” asked the White House yesterday.
“We are constantly and closely monitoring political and economic developments in Venezuela, and we are committed to calibrating our sanctions policy appropriately in response to both events on the ground and the broader national interests of the United States,” a Biden administration spokesperson responded.
This response reflects the logic of power that seeks to balance Kamala Harris' electoral agenda, Chevron's economic-financial strategy and the political needs of the Venezuelan opposition.
Chevron's position and economic concerns
Biden will not make any decisions that could complicate Harris’s campaign. The suspension of Chevron’s license could eventually raise fuel prices due to the drop in supply. And Washington still remembers that Jimmy Carter lost re-election to Ronald Reagan because of rising gas prices and the hostage crisis.
Chevron executives have already visited the West Wing of the White House and argued that suspending the license could cause shortages, higher prices per gallon and a new wave of illegal immigration, as a consequence of the drop in revenue in Venezuela's complex economy.
Chevron CEO Mike Wirth reinforced the U.S. company’s arguments during a conference call in early August. “We are there (Venezuela) to help develop the economy, support the people, create jobs and not get involved in politics, which can change from one party to another in any country,” he said. He added: “We do not have a role in choosing governments. We are a commercial actor, not a political actor.”
Consequences for Venezuela and the United States
The National Security Council and the State Department have sufficient evidence to respond to the arguments of Chevron staff, who arrived at the White House to suggest that a possible suspension of the license could cause chaos in the energy supply.
The oil company produces about 200.000 barrels per day, an amount that would not impact the global market if Chevron were to be prevented from continuing to extract oil in Venezuela. As for oil prices, they are unlikely to spike in the United States due to falling demand.
On the other hand, the suspension of the license could cause an economic and political shock to the Venezuelan dictatorship. The 200.000 barrels per day represent about 20% of national oil exports and approximately 30% of the populist regime's oil revenue.
The future of the US-Venezuela relationship
“The Maduro regime remains in power using oil revenues, which depend on US intervention,” said Democratic Senator Dick Durbin, Senate Majority Leader.
“The message must be clear and direct: The United States will no longer do business with the Maduro dictatorship,” said Republican Representative María Elvira Salazar, as she introduced a bill to prevent American companies from doing business with the Maduro regime.
Despite the presidential campaign that pits Harris against Trump, senators and representatives from both parties agree on the need to apply economic sanctions to the populist regime. The aim is to suffocate the dictatorship so that it accepts a negotiating table with González Urrutia and María Corina Machado.
The White House shares Congress' strategy, but it will take time to make a decision.
