Petro Caribe Again?

 It’s all current news today so let’s do it…Rigzone reports that Caricom, the 15 member Caribbean Community, urged the removal of sanctions against Venezuela to allow the countries to benefit from the Maduro regime’s proposed revival of Petro Caribe and for further progress on the Trinidad & Tobago/Venezuela joint venture natural gas project (also a restart) Dragon Field.

 US Secretary of State, Anthony Blinken, did not address sanctions on Venezuela in his speech. The relaunch of Petro Caribe, suspended since 2018, is more grounded in fantasy than reality.

 The program was initially launched in 2005 and in the early years the Chavistas were able to fund the discounted oil sales, the unrealistic financing, unsustainable social programs, and more due to historically high oil prices, high oil production, and massive (and unnecessary) borrowing.

 Well, oil prices are well off those highs, Venezuela’s oil production is 20% of what it was, and the Maduro regime has exhausted all possible avenues of credit, pretty much from anywhere. Without oil and without money the relaunch of Petro Caribe is really nothing more than a pipe dream.

 As far as the reactivation of the Dragon Field natural gas project goes, Washington has said it will not block it’s redevelopment but it is facing some headwinds, not form the Trinidad & Tobago side but from the Venezuela side.

 The recently granted license for development prohibits Venezuela from receiving any cash from exports so it’s doubtful they will be very enthusiastic and any further sanctions-easing could be (should be) negatively impacted by the Maduro regime’s decision to ban leading opposition candidate, Maria Corina Machado, from holding office for 15 years.

 All current sanctions-easing has supposedly been contingent on the Maduro regime taking “concrete steps” toward a return to democracy and holding free and fair elections. If the US adheres to the terms for relaxation of sanctions, not only will further sanctions-easing not be likely, the sanctions should be reimposed to their full effect. So…is this posturing by Caricom much ado about nothing?

 Then we have Reuters reporting that Venezuela is planning to introduce new regulations on courier shipments of food, medicine, and other products, according to one government and two private sector sources.

 So called “door to door” courier services were originally used by individuals to circumvent shortages in Venezuela’s crisis hit economy but de facto dollarization has led retailers to take advantage of the fewer restrictions and tax exemptions on the couriers.

 In a bid to raise tax revenue the government is preparing to regulate them, sources said. Several courier companies have announced on social media they are suspending shipments as they await official action.

 This certainly won’t help availability of medicine (shortages have been 80% or higher since 2014, well before sanctions for those of you keeping track) and retail items will be more expensive in a country with a current inflation rate of 430%.

 The Chavistas just can’t help themselves. Anything that’s working to benefit the people of Venezuela faces new regulations and taxes. “Viva la Revolucion!”

 Then we have BNN Bloomberg reporting that PDVSA (Venezuela government-owned oil company) canceled a contract with Maroil Trading, according to firm owner and long-time Chavista ally, Wilmer Ruperti.

 The move is a result of a PDVSA internal audit which, according to PDVSA, shows Maroil owes the company $432 million while Ruperti claims PDVSA owes more than $300 million to Maroil.

 At the center of the discrepancy is a contract signed in 2016, set to expire in 2021. Ruperti claims the contract was extended for two years due to Covid-19. Under the original contract Maroil would be owed the over $300 million while if, as PDVSA claims, the contract expired and was not extended then Maroil owes PDVSA $432 million. Who do you believe? The state oil company did not respond to requests for comment.

 And we have Rio Times reporting that Venezuela’s TSJ (Supreme Court) is reviewing the request by pre-candidate,Luis Ratti, made in May, to suspend the opposition primaries scheduled for October 22nd.

 Ratti expressed his belief that the primary process should not include disqualified candidate, Maria Corina Machado, nor Henrique Capriles (previously banned from holding public office) and that Ms Machado’s candidacy in particular could lead to instigating violence. Kinda sounds like the old Maduro regime claims that the violence in the 2017 and 2014 protests was instigated by the protesters and not the government security forces and government-backed ‘colectivos’ that were killing them.

 Sources say that TSJ now has all supporting documents for the appeal by Ratti and a decision is expected in the near future

 Then we have Sanctions reporting that the US Treasury Department – OFAC (Office of Foreign Asset Control) issued a continuation of a Venezuela-related license authorizing the export of liquid petroleum gas to any entity owned by PDVSA.

 This license doesn’t have much impact as it’s for products exported to Venezuela, not from Venezuela, but it may signal that the Biden administration is amenable to continuing it’s relaxed policy toward Venezuela-related sanctions.

 If so, that would be disappointing as they should be taking a firm stand toward the Maduro regime and their recent disqualification of opposition candidate, Maria Corina Machado, barred from holding public office for 15 years.

 That will do it for the week. We’ll be back Monday to kick off another reprise of Venezuela : Down The Rabbit Hole as well as more current news. Until then… Have a great weekend everybody!!!



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