The Trump administration is preparing to order more companies to cease operations in Venezuela, following orders to Chevron. Companies like Etablissements Maurel & Prom and those owned by Harry Sargeant face a 30-day deadline to comply. This decision could substantially harm Venezuela’s economy, which is heavily reliant on oil, as the US pressures Maduro for reforms and migrant acceptance.
The Trump administration is reportedly preparing to mandate several companies to cease operations in Venezuela, intensifying pressure on President Nicolas Maduro. Following a directive for Chevron Corp. to halt its activities, other companies, such as French oil producer Etablissements Maurel & Prom SA and an asphalt enterprise owned by Harry Sargeant, have been informed that they would have 30 days to comply once their operational waivers are revoked by the US Treasury.
This potential development poses a significant threat to Venezuela’s fragile economy, as it relies heavily on oil production. The cessation of these companies’ operations could severely impact Maduro’s government, particularly as Trump advocates for democratic reforms and seeks to negotiate an increase in migrant reception from Venezuela to the US. Chevron has been given a deadline to conclude its Venezuelan operations by April 3, a much shorter timeframe than the standard six months.
Venezuela’s economy has been largely supported by foreign oil companies, as the state-owned oil enterprise has suffered from years of neglect and failure to invest. The Trump administration’s various advisors hold differing opinions on the best course of action regarding Venezuela, suggesting a possibility that the President may reassess and allow oil companies to continue their operations.
Other foreign firms, including Spain’s Repsol SA and Italy’s Eni SpA, are also awaiting the US’s decision on their operational waivers. Reports indicate that joint ventures between Chevron and Petroleos de Venezuela SA provided around 25% of the Maduro regime’s total revenue for 2023 and 2024. The absence of Chevron could lead to an estimated contraction of up to 7.5% in Venezuela’s economy this year.
Rick Grenell, a Trump advisor, met with Maduro in January to renew discussions, which resulted in the release of six US citizens and the reinstatement of deportation flights. Following this engagement, 166 Venezuelan migrants have returned to Venezuela, with the last flight arriving on February 20. Despite these developments, Maduro has claimed that the departure of Chevron would have minimal impact on oil production, asserting that “output will not even fall one liter or barrel.”
In summary, the Trump administration is poised to intensify sanctions against Venezuelan operations, impacting companies such as Chevron and potentially affecting the nation’s economy significantly. The direction remains uncertain as differing opinions within the administration could lead to changes in strategy. Should these actions proceed, Venezuela’s economic downturn could be pronounced, especially with a looming deadline for Chevron and other foreign entities to comply with sanctions. Moreover, ongoing negotiations with Maduro may continue to shape the future of US-Venezuela relations.
Original Source: www.livemint.com
