WASHINGTON (AP) – The Trump administration announced sanctions Tuesday on a Russian state-controlled brokerage that has helped the Venezuelan government skirt an American oil embargo and enabled President Nicolas Maduro to keep his grip on power in the South American country.
Administration officials said Rosneft Trading S.A. and its president, Didier Casimiro, would be added to a financial blacklist in a move that is expected to largely freeze him and the company out of the global financial system.
The action is an unusually aggressive move against a company linked to the Russian state and amounts to a substantial escalation of a U.S.-led campaign that has failed to oust Maduro from power.
Secretary of State Mike Pompeo said Rosneft Trading is the primary broker for the sale and transportation of Venezuelan crude oil, which has been under sweeping U.S. sanctions since January 2019 as part of the pressure campaign against Maduro.
â€œRosneft Trading has propped up the dictatorial Maduro, enabling his repression of the Venezuelan people,â€ he said in announcing the sanctions.
Rosneft Trading, based in Switzerland, was created in 2011 to facilitate trades on behalf of the parent company, which has been under U.S. sanctions since 2014, said Elliott Abrams, the special U.S. envoy for Venezuela.
The brokerage has helped arrange sales of Venezuelan crude by deceiving customers, mostly in Asia, about the source of the oil with such tactics as changing the name of the tanker, Abrams said.
Rosneft did not immediately respond to a request for comment.
But Russian lawmaker Pavel Zavalny said the country would continue to cooperate with its ally Venezuela in the energy sector despite the U.S. sanctions. â€œOne doesnâ€™t abandon friends in need,â€ Zavalny said.
The U.S. and about 60 other countries say Maduroâ€™s reelection in 2018 was not legitimate and have recognized opposition leader Juan Guaido as interim president. The Venezuelan leader has held on with support from Russia and China.
President Donald Trump recently reaffirmed his support for GuaidÃ³, recognizing him in the State of the Union address as Venezuela’s “true and legitimate” leader and calling Maduro a “tyrant.” He then welcomed the opposition leader to a coveted Oval Office meeting.
The gesture bolstered GuaidÃ³ as support back home fades a year after he rose to the center of Venezuela’s tumultuous political landscape, vowing to oust Maduro and end the oil-rich nation’s political and financial crisis.
The U.S. is considering additional economic sanctions â€œin the coming weeks and monthsâ€ aimed at further tightening economic pressure on the Maduro government, Abrams told reporters at the State Department.
Maduro has held on to power despite runaway hyperinflation, a massive exodus and shortages of food and medicine as well as the international pressure that has left his socialist administration isolated.
Venezuelan oil shipments dropped significantly last year because of U.S. sanctions but the country still managed to ship hundreds of thousands of barrels of crude last year with the help of Rosneft Trading.
Rosneft is now managing about two-thirds of Venezuela’s international oil trade as it was able to work around the American sanctions, said Francisco RodrÃguez, an economics professor at the Stone Center for Latin American Studies at Tulane University.
â€œIf these sanctions are effective in curtailing Rosneft’s activity with Venezuela, then this will have a very significant effect on the government’s ability to generate revenue and the government’s ability to pay for imports,â€ RodrÃguez said.
While economic measures have so far failed to dislodge Maduro, GuaidÃ³ called the latest sanctions a â€œnew victory!â€
â€œWhoever supports the dictator, from whatever part of the world, will bear the consequences,â€ GuaidÃ³ tweeted. â€œThose who collaborate with democracy will be welcomed.â€
GuaidÃ³ launched a campaign to oust Maduro a year ago but so far has failed to make it a reality. He has been unable to flip the militaryâ€™s loyalty away from Maduro.
In recent months, the Venezuelans who had fervently supported GuaidÃ³ early on had stopped filling the streets for demonstrations, and Maduro has grown emboldened.
The action against Rosneft Trading and Casamiro means that any assets they have in the U.S. or in the control of U.S. financial institutions will be frozen. In addition, anyone doing business with them could face American sanctions.
Abrams said that would largely freeze the company and its president out of the global financial system because people will be reluctant to take the risk after a 90-day period to wind down any relationship.
Officials also said Trump approved the move. They said he has spoken with Russian President Vladimir Putin in the past about U.S. objections to his country’s support for Maduro.
Pompeo also discussed it with Foreign Minister Sergey Lavrov at a recent meeting.
Associated Press writers Daria Litvinova in Moscow and Fabiola Sanchez and Scott Smith in Caracas, Venezuela, contributed to this report.