Powered by

How Ukraine war reinvigorated Venezuela President Maduro

Maduro moves from a pariah to a potential partner of the US

Venezuela President Nicolas Maduro | Reuters Venezuela President Nicolas Maduro | Reuters

All is fair in love and war. Where there was no love between the US and Venezuela, the Russian invasion of Ukraine changed the dynamic; the need for oil due to the invasion began a process that can best be described as an ongoing reset between Washington and Caracas and a new life and power for Nicolas Maduro.

In John Lyly’s poetry, when it comes to matters of the heart and matters of state, anything goes. In US political prose, this idea is often used to justify extreme measures taken in pursuit of a desired outcome.

Almost from the minute that Putin invaded Ukraine threatening the gas supply to Europe, Maduro's sins as per the American Bible were forgiven. Soon there were prisoner exchanges and other signs of the rehabilitation of Venezuela signaling that a new geopolitical approach was on the horizon. 

Here, realpolitik meets geopolitics as the US relationship with Maduro is under rapprochement by the Biden administration, reassessing the US’s previous stance and lending a degree of legitimization to Maduro’s authoritarian regime, a government that the US does not officially recognize as legitimate. This in the quest of ameliorating the effect of US sanctions on Russian oil. Never mind the incongruity of lifting sanctions on one dictatorial regime to make possible the imposition of sanctions on another.

Not that the US needs the oil, but increased demand for oil from Europe could cause a higher demand for US oil and thus higher gas prices in America, which, after all, is what US politicians fear the most.

While the US produces its own shale oil, its refineries were processing Russian oil which they then supplied to Europe. An increased demand for oil from Europe translates into high demand for American oil, and thus higher prices at the pump for US consumers. Moreover, many US refineries are better equipped to handle Venezuela’s more viscous “heavy” crude and can process it more effectively than the runnier domestic or Saudi oil.  

The very next day after Russia began its invasion of Ukraine, on February 25, Venezuela, a strong ally of Russia, accused NATO and the United States of being responsible for the ongoing crisis in Ukraine. The Venezuelan foreign ministry stated that NATO and the United States had breached the Minsk agreements, a 2014 agreement aimed at resolving the war in Donbas separatist region in eastern Ukraine. 

But by March 9, the Venezuelan government, looking to take advantage of the opportunity to improve relations with the Biden administration, released two American citizens who were previously imprisoned, including an oil executive who had been held for over four years. The release of Gustavo Cardenas and Jorge Fernandez came after a secret visit to Venezuela by senior Biden administration officials, marking the first White House trip to the country in over two decades. 

As American consumers were alarmed by rising gas prices at the pump as a direct effect of the Ukraine conflict, Maduro had taken a televised address as an opportunity to express willingness to resume negotiations with his opponent Juan Guaidó as a first step towards relief from the US sanctions that have been impacting the OPEC nation for years. 

Guaidó  and the Venezuelan democratic opposition, composed of the majority bloc of opposition parties in the National Assembly, civil society organizations, professional and intellectual guilds, universities and academia, the private sector, independent media, and others relied on an interpretation of an article of the Venezuelan Constitution to support and give substance to a unique instrument called "interim government".

At the time, it was believed that the interim government would be the catalyst for a democratic transition in Venezuela through a three-step "mantra": 1) end of the usurpation, 2) transitional government, and 3) free elections. However, as per the most basic political theory, without the support of the Venezuelan Armed Forces, the interim government quickly entered into a process attrition in terms of the crystallization of its objectives.

Former President Donald Trump had imposed severe sanctions on Venezuela's oil as a means to restrict funding for the Maduro regime. According to US media reports, during the talks in Caracas, the Biden administration's delegation explored the option of lifting some of these sanctions and evaluated Maduro's willingness to distance Venezuela from Russia.

This is because following Russia's invasion, Biden recognized that this global event could potentially fuel domestic discontent due to its economic impact and the move was seen as a way to mitigate this potential outcome.

The lifting of sanctions on Venezuela would have far-reaching implications for the region's geopolitical landscape, as it would legitimize the authoritarian rule of President Nicolás Maduro, a process already under way independently of the United States, with the help of leftist governments in Argentina, Bolivia, Chile, and Colombia and the new Lula administration in Brazil.

A move by the US puts it in a position to take the lead once more in Latin American geopolitics. Though sanctions around the globe are mostly imposed by the US, UN, and EU, it is often a process driven by US foreign policy. 

In November, the US Treasury Department announced that it would permit Chevron, a US-based company, to resume limited operations in Venezuela. The company had maintained a presence in Venezuela despite sanctions, as a way to keep its facilities in the country from falling into disrepair.

According to the US Office of Foreign Assets Control (OFAC), the agency that administers and enforces economic sanctions programs primarily against countries, it permits: 

(1) Production and lifting of petroleum or petroleum products produced by the Chevron JVs, and any related maintenance, repair, or servicing of the Chevron JVs [joint ventures]; 

(2) Sale to, exportation to, or importation into the United States of petroleum or petroleum products produced by the Chevron JVs, provided that the petroleum and petroleum products produced by the Chevron JVs are first sold to Chevron; 

(3) Ensuring the health or safety of personnel or the integrity of operations or assets of the Chevron JVs in Venezuela; and 

(4) Purchase and importation into Venezuela of goods or inputs related to the activities described in paragraphs (a)(1)–(3) of this general license, including diluents, condensates, petroleum, or natural gas products.

In the US, the lure of moving Maduro away from Russia and closer to its interests was not lost on American policymakers.

For decades Russia injected itself between the US and the largest petroleum producer in Latin America employing strategies of debt relief and diplomatic support for Venezuela during both the tenure of former President Hugo Chavez and current President Nicolás Maduro. In recent years, it was increasingly providing military and intelligence assistance to Maduro, including sending specialists to maintain military equipment, selling aircraft and anti-missile systems, and conducting joint military exercises.

Thus, Maduro becomes an unexpected beneficiary of the events in Ukraine. On the face, Maduro’s regime is likely to continue its anti-American rhetoric, despite the recent US decision to allow Chevron to resume oil production in Venezuela, but the tradeoff for the US is its co-opting of one of Moscow's few ardent and unconditional allies in the world.

In the uncertainty of war, Venezuela’s largest oil reserves in the world, make it a particularly significant player in geo-strategic decisions and realpolitik.

Prior to the 2019 sanctions, the US imported half-a-million barrels of crude from Venezuela which it once produced 3 million barrels per day and was down to just over half-a-million last year. Easing of sanctions will allow Venezuela to boost production and to restore its oil industry, allowing its crude oil to be exported to global markets again.

Venezuelan oil is considered to be of lower quality due to its viscosity, which makes it more difficult to pump, transport, and refine. This heavy and extra-heavy oil is more viscous than conventional oil, and often needs to be mixed with lighter oil to be processed. Although Venezuela has 20 per cent of the world's oil reserves, extracting it is a challenging process.

On the environmental front, the extraction process for extra-heavy oil is more energy-intensive, and it has higher levels of contaminants than light oil, which is a concern for the Biden administration's environmental agenda. 

But such nuances get lost in the calculus of war. In fact, they may not be important at all. Victory is the goal. Collateral damage is part of the supreme art of war. Sun Tzu would smile to see the enemy subdued without fighting.

In the midst of the rapprochement lovefest, however, the end of Juan Guaidó's interim presidency was officially announced. In 2019, more than 50 countries around the world recognized him as the legitimate president of Venezuela in response to what was widely seen as electoral fraud in the 2018 presidential elections that yielded Maduro as the winner.

It is an American gain that Russia’s global influence is facing new challenges. The rapprochement between the United States and Venezuela is presenting the biggest challenge to Russia's alliance with Venezuela in recent history.

But the war’s greatest gain is Maduro’s who moves from a pariah to a potential partner in the eyes of the US and other countries. This could lead to diplomatic recognition and an end to the economic sanctions imposed on Venezuela, allowing it to access much-needed foreign investment and aid.

📣 The Week is now on Telegram. Click here to join our channel (@TheWeekmagazine) and stay updated with the latest headlines