Break in US-Venezuela relations raises fresh concerns for oil market and OPEC
The break in U.S.-Venezuela diplomatic relations raises concerns that Washington will expand sanctions to energy trade.
Venezuela relies on imports of super light oil from the United States, while U.S. refiners are big purchasers of heavy crude from the Bolivarian Republic.
Sanctions on Venezuela's energy minister, who holds OPEC's rotating presidency this year, would also create a headache for the 14-nation producer group.
A sudden escalation in long-burning tensions between the United States and Venezuela could have far-reaching ramifications in the oil market, where the Bolivarian Republic remains a significant player despite its plunging output.
On Wednesday, the Trump administration announced it would back Venezuelan National Assembly leader Juan Guaido, who declared himself the country's interim president earlier in the day. Shortly after President Donald Trump recognized Guaido, Venezuelan President Nicolas Maduro severed relations with the United States and gave U.S. diplomatic personnel 72 hours to leave the country.
The latest development raises the prospect that the United States will expand sanctions to U.S.-Venezuelan energy trade, a move that would be potentially devastating to Venezuela. The nation has seen its oil production crater in recent years, depriving the socialist republic of its lifeblood energy revenue and exacerbating a devastating economic crisis.
Read more: https://www.cnbc.com/2019/01/23/break-in-us-venezuela-relations-raises-fresh-concerns-for-oil-market.html
Venezuelan opposition leader Juan Guaidó declared himself the country's interim president amid nationwide protests Wednesday, in a bid to seize power from sitting leader Nicolás Maduro.
The U.S. swiftly proclaimed its support for Guaidó. Maduro responded by announcing a break in diplomatic relations with Washington.
Guaidó, the 35-year-old recently elected head of Venezuela's National Assembly, took the oath of office on an outdoor podium in Caracas, flanked by yellow, blue and red Venezuelan flags. He raised his right hand as a crowd erupted in cheers. He promised to serve as interim leader and call for general elections.
Read more: https://www.npr.org/2019/01/23/687643405/anti-maduro-protesters-march-in-cities-across-venezuela