All Quiet on the Venezuelan Front

Joss Millward
Mar 4, 2023
2 min read

Updated: Mar 8, 2023

As Venezuela ebbs towards a hotly contested election in 2024 there is reason for optimism as oil exports begin to flow to America once more. The highly controversial 2018 elections saw Western media outrage at what many including Ex-President Donald Trump called a fraudulent election with Nicolás Maduro supposedly winning 67.85% of the vote. The situation reached a crescendo as supporters of the opposition rival Juan Guaidó engaged in fierce protests for several months. Following a following a crackdown by the loyalist military and a subsequent easing of protests, Venezuela has slipped out of the news spotlight. Is Venezuela set to make headlines once more?

On 26th November 2022 the US government announced it would be providing Chevron Corp with a license to continue Oil production and Export to America once more. This is significant following the three years of strict oil sanctions from the US. This decision can be seen as part of the unusual fallout of the Ukraine conflict, as Russia becomes global public enemy number one, strict containment of states such as Venezuela and Iran is no longer prioritised. Furthermore the scramble for natural resources in the face of a winter of strangled global energy supplies means that states are willing to forego ideological difference for the sake of much needed trade. Iran has offered its gas to the European market despite US sanctions and many commenters appear optimistic that this may come to fruition.

A return to oil exports to the US is a good sign for the Venezuelan economy however it is not the sole source of optimism. Venezuelan oil exports are standing firm with Iran and China with 710,033 barrels a day in September compared to an average 448,000 average in 2021. Despite a decline in GDP from 2012 bottoming out at $106.36 billion in 2020, there has since been a consistent increase with the IMF projecting a real GDP growth of 6% in 2022.

Riding on the tails of the US announcement Canada, the United Kingdom and the EU have also pledged a “Willingness to review sanctions on Venezuela according to Al Jazeera. These pledges came on the conditions that Venezuela would release political prisoners, respet press freedom and guarantee the independence of the judiciary and electoral bodies. Given the bleak outlook in terms of a resolution to the situation in Ukraine we may see these states forego these conditions out of a desperate need to resolve their own energy crises.

Economic optimism coincides with a simmering down of political tensions. The United States recognised opposition leader Juan Guaidó public support sits at 15% in February 2022, compared to a massive 60% three years prior according to Venezuelan polling company Datanalisis.

So it appears there is a trifecta of reasoning behind Venezuela’s return to global attention, firstly as a renewed source of oil to fuel a hungry world energy industry, secondly an economic resurfacing following years of decline, and thirdly an upcoming election for which new lines in the sand will be drawn, both domestically and in terms of who states will accept as the newly legitimised leader of Venezuela.