December 2, 2022

OPEC+ cut forces US to consider negotiation over Venezuelan oil industry

Opec+ cut forces US to consider negotiation over Venezuelan oil industry. The Biden Administration is negotiating with Caracas to loosen sanctions on the oil sectoras a response to OPEC+ cuts that risk exacerbating inflation, the WSJ’s Patricia Garip, Vivian Salama, and Kejal Vyas report. The sanctions relief would allow US oil giant Chevron to resume operations there and unfreeze hundreds of millions in frozen Venezuelan assets.

In return, President Nicolás Maduro would agree to resume negotiations with the country’s opposition to ensure the upcoming 2024 presidential elections are free and fair. The proposal is stoking fury among some of the regime’s most strident foes, who say the strategy would allow Maduro to maintain his authoritarian grip on the country with few concessions, the Journal reports. 

Some analysts believe Venezuela could double its current 450,000 barrels per day oil production within months if the sanctions were lifted. However, even under ideal conditions, the Venezuelan oil industry faces substantial challenges that will likely constrain total production under a million BPD, according to consultancy Rapidan Energy.

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