The United States has authorized the interim Government of Venezuela to sell fertilizers and other petrochemical products to American companies, according to an order from the Office of Foreign Assets Control (OFAC), dependent on the Treasury Department. The measure represents a relief from Washington’s sanctions against Caracas in the middle of the Iran war, when the price of oil and other derived products, such as fertilizers, has skyrocketed due to supply difficulties from the Middle East.
The “authorization of certain activities related to oil or petrochemical products of Venezuelan origin” allows US companies “all transactions prohibited by the sanctions regulations on Venezuela” for the export, sale, supply, storage, marketing, purchase, delivery and transportation of oil of Venezuelan origin, including its refining, or of petrochemical products of Venezuelan origin for importation into the United States, by an established US entity,” according to the document signed by the director of the Office of Assets Abroad, Bradley T. Smith, to whom EL PAÍS has had access.
The measure represents another step in the normalization of trade relations between Washington and Caracas, affected by the drastic embargoes and sanctions imposed by the US Administration on the Caribbean country during the years of the Chavista regime.
Following the military operation by the US army on January 3 to capture former President Nicolás Maduro in Caracas, the Trump Administration has granted licenses to several global oil companies, including the Spanish Repsol, to operate again in the Latin American country.
The White House’s decision to allow sales of Venezuelan fertilizers comes at a time when the price of fuel and fertilizers is beginning to affect American ranchers and farmers, many of them in the Midwest, who supported Trump en masse during the last presidential election.
The Treasury Department order enables trade for almost fifty chemical compounds derived from petroleum and other natural resources such as sulfur, ammonia, nitrates, urea, phosphates and other chemical fertilizer mixtures.
Disruptions to the transit of oil and petrochemicals through the Strait of Hormuz have disrupted global trade. Tehran’s threats that they will bomb ships transiting the Persian Gulf waterway have triggered a wave of nervousness among investors and sent the price of oil up to around $100 a barrel, almost double what it was a month ago.
The rise in the price of fuel and petrochemicals also coincides with the start of the spring planting campaign, according to Bloomberg. The shortage of ammonia and urea is making fertilizers more expensive. They are two chemicals that Venezuela can easily produce and export. So far, the United States imports more than a third of its urea from Persian Gulf countries, according to The Fertilizer Institute.
Since the United States imprisoned Maduro in a Manhattan (New York) prison, diplomatic relations between the interim president, Delcy Rodríguez, and the Trump Administration have become cordial and fluid. The American president usually praises the collaboration of the Venezuelan woman who is approving measures to reopen her country’s industry to American companies. Of course, under the strict tutelage of Washington.
Caracas has also promoted several legislative changes in the national parliament to favor the exploitation of the enormous natural resources it has by foreign companies. In addition to having the largest oil reserves in the world, it has enormous gas deposits; of gold, iron, bauxite, and diamonds.
Before the industrial collapse of the time of the Chavista regime, the Caribbean country was a power in the exploitation and export of oil and petrochemical products, as well as natural gas, iron ore and transformed aluminum and steel products, among others.