The Trump administration is preparing to compel more companies, including Chevron, to cease operations in Venezuela. This move follows a recent mandate for Chevron to end its activities, which will negatively impact Venezuela’s economy. Other companies await decisions on their operational waivers as the U.S. asserts pressure on Maduro for reforms and migration agreements.
The Trump administration is reportedly set to compel additional companies to cease their operations in Venezuela, intensifying pressure on President Nicolas Maduro. This follows a recent directive to Chevron Corp. to suspend its activities in the country. Companies including the French oil producer Etablissements Maurel & Prom SA and a Florida asphalt firm owned by Harry Sargeant have been informed they will have 30 days to terminate operations following the revocation of their operating waivers due to sanctions.
The termination of these companies’ operations is expected to significantly harm Venezuela’s struggling economy, further constraining Maduro’s position as the Trump administration seeks democratic reforms and increased acceptance of migrants from the US. Earlier this week, the Treasury Department instructed Chevron to conclude its activities by April 3, providing much less time than the standard six-month wind-down period.
Venezuela’s economy heavily relies on oil, with Chevron and other smaller firms that obtained U.S. permission to operate serving as critical growth drivers. The state oil company has suffered for years due to inadequate investment. There exists a divergence of opinions among advisors in the Trump administration regarding the Venezuelan approach, which could lead to a sudden policy shift enabling oil companies to maintain operations.
Several foreign enterprises, including Spain’s Repsol SA and Italy’s Eni SpA, are currently awaiting guidance on their operating waivers. The Treasury Department and Venezuela’s information ministry have not yet responded to inquiries regarding this matter.
Chevron’s joint operations with Petroleos de Venezuela SA are estimated to account for a quarter of Maduro’s total revenue for 2023 and 2024. Should Chevron withdraw, Venezuela’s economy might contract by as much as 7.5% this year, according to the Finance Observatory, an opposition-aligned research group.
Rick Grenell, a Trump advisor, met with Maduro in January to revive direct discussions, which recently resulted in the release of six US prisoners and the resumption of deportation flights. As of now, 166 Venezuelan migrants have been sent back from the US, with the last flight arriving in Caracas on February 20. In response to Chevron’s potential exit, Maduro claimed that “output will not even fall one liter or barrel.”
In summary, the imminent decision by the Trump administration to force numerous companies, including Chevron, to cease operations in Venezuela could profoundly impact the nation’s economy and President Maduro’s governance. With oil being vital for Venezuela, the prospect of additional companies withdrawing amidst U.S. sanctions poses significant challenges to economic stability. This development highlights the complex dynamics of U.S.-Venezuela relations and the ongoing discourse regarding democratic reforms and migration issues.
Original Source: www.livemint.com
