Page 5 - LatAmOil Week 05 2020

LatAmOil COMMENTARY LatAmOil
 Targetcompanies
e mention of Rosne is hardly surprising. e state-owned Russian company remained the biggest receiver of Venezuelan crude in 2019, and US government o cials have repeatedly accused it of using underhanded means to bring Venezuelan crude to market in de ance of the sanctions regime.
The inclusion of Repsol is a bit more of a stretch. The Spanish company suspended its crude swaps with Venezuela’s national oil company (NOC) PdVSA last year, a er the US expanded restrictions on trade, and does not appear to have had extensive dealings with the South American state since then.
( ere are rumours, though, that Venezuelan o cials have held talks with Repsol representa- tives on Caracas’ proposal to let foreign inves- tors take larger stakes in their joint ventures with PdVSA.)
Meanwhile, Chevron’s presence on the list warrants closer attention. The US major has repeatedly requested – and obtained – tempo- rary waivers from the sanctions, and as a result it has been able to keep its Venezuelan operations running, though at a lower level than before. If conditions change, the company would have to shut down Petropiar, its joint venture with PdVSA. It might also lose its chance to become the biggest US player in Venezuela if, as Wash- ington hopes, Maduro finally relinquishes power.
In ghting
But for the Trump administration, the time to take action, even if it goes against the interests of Chevron, may have arrived.
Guaido is under pressure of his own. Sev- eral members of his opposition coalition broke away in late January, following the National
Assembly’s vote to approve a budget allocation of up to $20mn for payment of legal fees incurred during attempts to keep PdVSA’s US-based assets, including Citgo, out of the hands of cred- itors. Two key opposition factions, Accion Dem- ocratica and Primero Justicia, refused to endorse the resolution, and Guaido’s Voluntad Popular was only able to pass it because it secured the agreement of Un Nuevo Tiempo, another oppo- sition faction, and several tiny splinter parties.
This disagreement may not have much
impact in the short term. e National Assem-
bly is under the physical control of the Maduro
regime, even though opposition legislators are
in the majority. As such, its ability to enforce the “ results of its votes is limited.
Nevertheless, this development may indicate that Guaido’s support among the opposition is weakening. Indeed, Argus Media reported in late January that Jose Ignacio Hernandez, the interim cabinet’s attorney general, had refused to distribute the funds authorised in the budget resolution without a consensus in Parliament.
No more waivers?
Under these circumstances, o cials in Wash- ington may be worried about their chances of securing Guaido’s position as Maduro’s successor.
If so, they have a good reason to contemplate additional sanctions. at is, they appear to be ready to exert further economic pressure in the event that Maduro outlasts the competition and puts his regime back in the position of being the only source of power.
If so, Chevron’s interests in Venezuela could very well take a back seat to the US government’s campaign against the Bolivarian socialism championed by Maduro (and his predecessor, Hugo Chavez). ™
Without sanctions waivers, Chevron will have to shut down Petropiar, its joint venture with PdVSA
Guaido and his team have been working to keep Citgo and other PdVSA assets out of the hands of creditors (Photo: PdVSA)
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