U.S. could ban imports of Venezuelan crude oil

The U.S. administration is considering choking off Venezuela's last remaining and rapidly dwindling source of income:...

Posted: Feb. 5, 2018 2:20 PM
Updated: Feb. 5, 2018 2:20 PM

The U.S. administration is considering choking off Venezuela's last remaining and rapidly dwindling source of income: crude oil exports.

Speaking in Argentina, Sec. of State Rex Tillerson said the U.S. was discussing how to raise the pressure on Venezuelan President Nicolas Maduro to restore his country's constitution and hold free and fair elections.

"Obviously sanctioning the oil, or in effect prohibiting the oil to be sold in the United States... is something we continue to consider," he told reporters on Sunday.

Banning exports of oil or refined oil products to Venezuela was also on the table, Tillerson added.

Oil sanctions are one of the few options President Trump has to really hurt Maduro.

Venezuelan production has been falling fast since 2014, but the country still pumped 1.7 million barrels a day in December, according to industry estimates.

Exports to the U.S. averaged more than 600,000 barrels a day between January and November last year, data from the U.S. Energy Information Agency shows.

Related: EU heaps sanctions on Venezuela as isolation grows

The decline in oil production is already deepening the misery for 30 million Venezuelans suffering from food shortages and a lack of basic medicines. Sanctioning oil exports could make matters much worse.

"The situation is becoming quite dire in Venezuela," said Tillerson, who added that the administration was weighing the effect of sanctions on the Venezuelan people -- and whether they would quickly produce the desired result.

"Because not doing anything to bring this to an end is also asking the Venezuelan people to suffer for a much longer time," he said.

Related: Trump's tough call about Venezuela and oil

It's also a complex business equation. The U.S. sends light crude oil to Venezuela, which has heavy crude. The two get mixed together in Venezuela and shipped back to the United States.

Banning cheap imports from Venezuela would force U.S. refineries to buy elsewhere, and that could push up gas prices.

"We're looking at how to mitigate... the impacts on U.S. business interests," said Tillerson, the former chief executive of Exxon Mobil.

Analysts say U.S. oil sanctions could completely cripple the Venezuelan economy.

-- Patrick Gillespie and Claudia Dominguez contributed to this article.

Article Comments

Mason City
Overcast
31° wxIcon
Hi: 29° Lo: 20°
Feels Like: 23°
Albert Lea
Overcast
34° wxIcon
Hi: 27° Lo: 19°
Feels Like: 30°
Austin
Overcast
32° wxIcon
Hi: 27° Lo: 18°
Feels Like: 24°
Charles City
Few Clouds
23° wxIcon
Hi: 27° Lo: 20°
Feels Like: 13°
Rochester
Overcast
30° wxIcon
Hi: 25° Lo: 18°
Feels Like: 24°
We're tracking easy going traveling heading to Thanksgiving
KIMT Radar
KIMT Eye in the sky

Latest Video

Image

Big announcement for downtown project

Image

Utility rate changes

Image

Change in Mason City firework ordinance

Image

Interfaith service

Image

Basement fire in southeast Rochester home

Image

Thanksgiving meals for those in need

Image

Meeting the candidates

Image

Diocese bankruptcy filing

Image

Students learning life skills through business

Image

Switching to Paper Gift Cards

Community Events