Tillerson raises specter of US sanctions on Venezuelan oil

Reuters BUENOS AIRES: The United States is considering restricting imports of Venezuelan crude oil and exports of US refined products to Venezuela, US Secretary of State Rex Tillerson said on Sunday, to put pressure on socialist President Nicolas Maduro to “return to the constitution.”

“One of the aspects of considering sanctioning oil is what effect would it have on the Venezuelan people? Is it a step that might bring this to an end more rapidly?” Tillerson said at a news conference in Buenos Aires, referring to Venezuela’s economic and political crisis.

Tillerson, on a Latin America trip that also includes visits to Mexico, Peru, Colombia and Jamaica, raised eyebrows on Friday after he suggested that Maduro could be toppled by his own military.

Restrictions on Venezuela’s all-important oil industry would represent an escalation of financial pressure on the OPEC member, which is gripped by severe shortages of food and medicine. Sanctions have so far focused on individual members of Maduro’s government and a ban on buying new Venezuelan debt.

“We are looking at options and we are looking at how to mitigate the impacts on US business interests” and on other countries in the region, Tillerson said.

Standing next to Tillerson at the news conference, Argentine Foreign Minister Jorge Faurie said his country would “closely follow” the possibility of oil and fuel sale restrictions, but said sanctions “must never harm the Venezuelan people.”

Other Latin American governments have said they were unwilling to take steps that would worsen the humanitarian crisis in Venezuela,

“Not doing anything to bring this (crisis) to an end is also asking the Venezuelan people to suffer,” Tillerson said.

Venezuela’s crude oil sales to the United States in 2017 were the lowest since 1991, according to Thomson Reuters trade flows data, hurt by sanctions on the OPEC nation.

Citing sources, Reuters reported last June that the Trump administration was considering sanctions on Venezuela’s energy sector, including state oil company PDVSA, responsible for most of the country’s exports.

Meanwhile, Trump’s call this week to cut aid for countries where drugs are produced or trafficked could cast a shadow on Tillerson’s South America visit as he headed for top cocaine-producing nations Peru and Colombia.
Trump said on Friday that unnamed countries were “pouring drugs” into the United States.

“I won’t mention names right now … but I look at these countries, I look at the numbers we send them and we send them massive aid, and they are pouring drugs into our country and they are laughing at us,” Trump said at a televised round-table in Virginia.

“So I’m not a believer in that, I want to stop the aid,” Trump said after Kevin McAleenan, acting commissioner of US Customs and Border Protection, told him that cocaine was primarily coming from Colombia and Peru, and trafficked through Mexico and Central America.

Tillerson did not mention Trump’s comments in the news conference in Buenos Aires but a senior state department official on the trip, who declined to be identified, said that they were “not helpful.”

Trump has at times contradicted Tillerson on foreign policy issues involving North Korea and Syria, and the administration has been criticized for sending mixed messages to Latin America, particularly on Venezuela.

Tillerson lands in the Peruvian capital Lima on Monday and on Tuesday heads to Colombia, which received some $10 billion in funding between 2000 and 2015 for military and social programs through the so-called Plan Colombia.

Former US President Barack Obama had approved $450 million in 2017 aid for Colombia, up 25 percent from 2016, to help support a peace deal with the Revolutionary Armed Forces of Colombia, or FARC, a former leftist rebel group.

Peru, which has seen cocaine output increase and trades the title of top producer with Colombia, has received less assistance from the United States. Tillerson ends his trip in Jamaica, a growing drug trafficking hub.

The US is the world’s largest market for cocaine.

Trump has threatened to cut aid around the world, questioning what the United States gets in return for its support. Earlier this year, he promised to end assistance for Pakistan.

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