EU Mulls More Sanctions, But Not Oil Embargo, On Venezuela

The European Union (EU) is mulling over imposing more sanctions on Venezuela, but those sanctions will not be targeting the oil sector, as the bloc looks to punish individuals, not the people of Venezuela, Malta's Foreign Minister Carmelo Abela told Reuters on Monday.

"Having further (sectoral) sanctions is not excluded but primarily we are focused on certain individuals," Abela told Reuters after a meeting of EU foreign ministers in Brussels.

The EU initially imposed sanctions on Venezuela in November 2017, including an embargo on arms and on equipment for internal repression as well as a travel ban and an asset freeze on 18 individuals. In November 2018, the EU extended those sanctions by another year, "in view of the continuing deterioration of the situation in Venezuela."

While the United States was quick to recognize opposition leader Juan Guaidó as the legitimate president of Venezuela and imposed sanctions on state oil firm PDVSA, the EU bloc initially said that the voices of Venezuelan people calling for democracy "cannot be ignored."

"The EU strongly calls for the start of an immediate political process leading to free and credible elections, in conformity with the Constitutional order," the EU said in its early reaction to the Venezuelan crisis, but stopped short of backing Guaidó.

Then Germany, as well as Spain, called on Maduro to "immediately" agree to hold new elections, otherwise both EU members would consider backing Guaidó.

After an eight-day deadline for Maduro to call elections expired on Sunday, many of the biggest EU nations, including the UK, Germany, France, and Spain, recognized Guaidó as interim president of Venezuela.  

Now more sanctions are in the works against Venezuela, but the EU is unwilling to punish an entire sector, and an important sector like the oil industry at that. According to Reuters estimates, crude oil and products account for three quarters of Venezuela's exports to the EU.

Last week, European buyers of the heavy crude produced by Venezuela's PDVSA were said to have put their purchases on hold in anticipation of sanctions against the government in Caracas to be announced by the EU.

By Tsvetana Paraskova for Oilprice.com

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