Venezuela: OFAC Loosens Oil, Gold, Bond Restrictions

In response to the signing of an electoral roadmap agreement between Venezuela’s Unitary Platform and representatives of Maduro,  Treasury’s Office of Foreign Assets Control (OFAC) issued 4 General Licenses suspending select sanctions.  The G/Ls permit limited trading in Oil, Gold and certain Venezuelan sovereign bonds and PdVSA debt and equity.

Under Secretary of the Treasury for Terrorism and Financial Intelligence Brian E. Nelson issued the following statement on the October 18, 2022  General License Action:

“The United States welcomes the signing of an electoral roadmap agreement between the Unitary Platform and Maduro representatives. Consistent with U.S. sanctions policy, in response to these democratic developments, the U.S. Department of the Treasury has issued General Licenses authorizing transactions involving Venezuela’s oil and gas sector and gold sector, as well as removing the ban on secondary trading. 

Treasury is prepared to amend or revoke authorizations at any time, should representatives of Maduro fail to follow through on their commitments. All other restrictions imposed by the United States on Venezuela remain in place, and we will continue to hold bad actors accountable. We stand with the Venezuelan people and support Venezuelan democracy.”

Petroleum, Gold & Bonds

• Issued a six-month general license temporarily authorizing transactions involving the oil and gas sector in Venezuela.  The license will be renewed only if Venezuela meets its commitments under the electoral roadmap as well as other commitments with respect to those who are wrongfully detained. 
• Issued a second general license authorizing dealings with Minerven – the Venezuelan state-owned gold mining company – which Treasury assesses would have the effect of reducing black-market trading in gold.
• Amended two relevant licenses to remove the secondary trading ban on certain Venezuelan sovereign bonds and PdVSA debt and equity. The ban on trading in the primary Venezuelan bond market remains in place.  Treasury assesses that this, too, would have the positive effect of displacing nefarious players in this market, and with negligible financial benefit to the Venezuelan regime.  

OFAC has also provided several Frequently Asked Questions (FAQs), available here.