The Venezuelan political drama

President Donald Trump and his hard-line security advisorsare currently strongly going after two major oil-producing countries. These areVenezuela and Iran which hold the world’s largest (300 billion barrels) andfourth largest (158 billion barrels) oil reserves respectively. Both countriesare under very severe US sanctions. These are interrupting their global ties,including with India, especially in the critical hydrocarbons sector. The US’sultimate object in both cases is regime change. It has proceeded far down thisroad in Venezuela’s case because its polity and society is split; it has alsomade no secret of its desire to see an end to the Vilayat-e-Faqih system inIran.

There has been substantial Indian national focus on theIranian situation on account of its geo-political importance to India and theregion, the mutual civilizational impact, including because of faith basedconnections and significant commercial relations. However, Venezuelan eventshave been largely ignored though they too effect India’s energy security andoffer yet another window to understand how the Trump administration conductsbusiness. A focus on current developments in Venezuela would therefore berewarding.

   

The current chapter of Venezuelan events can be traced toJanuary this year when President Nicolas Maduro took oath as President for asecond term on the basis of an election in June 2018. That election was notaccepted by Venezuela’s National Assembly as the opposition was virtuallydenied participation. Consequently, once Maduro’s first term ended in January,Juan Guaido, the National Assembly head declared himself as President. He didso on the strength of the Venezuela constitution which decrees that if thePresidency is vacant the head of the National Assembly acts as President.

Thus from January Venezuela is politically and sociallysplit. Maduro has the backing of the army. He draws his social support largelyfrom the poor and underprivileged sections of society who remain committed tothe ideals of Maduro’s predecessor Hugo Chavez’s Bolivarian revolution. Chavezbecame President in 1998 and convened a constituent assembly in 1999 to frame asocialistic constitution on the principles of democracy, national economicindependence, absence of corruption and equitable distribution of wealth. Healso began large schemes giving subsidies to the poor which ran intodifficulties once oil revenues shrank because of a down turn in global oilprices.

Oil was discovered in Venezuela in 1914 and within a fewdecades it became one of world’s leading exporters of this vital commodity.Naturally, the US took great interest in Venezuela all through the 20thcentury. Though Venezuela was one of the founder members of OPEC and hadnationalised its oil industry beginning with the 1970s its links with the USwere strong. Chavez sought to fundamentally change the direction of his countryaligning it with countries hostile to the US—Cuba, Nicaragua and Bolivia.Naturally, this eroded the foundations of the US –Venezuela relationship andthe successive US administrations put the squeeze on this South Americancountry of 30 million. After Chavez’s death in 2013 Maduro has continued with hisapproaches.

US economic pressure on Venezuela has greatly strengthenedduring the Trump presidency. The sanctions have hit the country’s oil industrycrippling the economy further. With large social distress almost 10% of thecountry’s population have migrated out. It is this economic and socialsituation in which the Venezuelan political drama is playing out since January.Naturally, it has international dimensions too. The US and its western alliesincluding France and Germany have accepted Guaido as President. So have the twoleading South American states, Brazil and Argentina. However, China and Russiaare supporting Maduro as are Iran, Turkey and Cuba. He also continues to holdthe United Nations seat.

Earlier this month Guaido made a big push against Maduro. Hewas in secret contact with some senior civil and military members of the Madurogovernment and some members of the Supreme Court. He had hoped that they comeout against him and their pressure along with street demonstrations will compelMaduro to leave. However, these persons did not leave Maduro and the army iswith him. The failure of this push has embarrassed the US and Guaido. On itspart the US has said that the military option against Maduro remains in itscalculus and Guaido has asked his Washington representative to talk to the USSouthern Command to increase pressure. However, this is dangerous as long asRussia and China continue with their links with Maduro. There is therefore noearly end to the Venezuelan crisis in sight.

India has not taken a position on Venezuela. It hasemphasised the need for its people to find a solution to their problems. It hasalso let the Maduro representatives to continue manning the Venezuela embassyin Delhi. All told these are correct positions to take. MeanwhileIndia-Venezuela oil relations have been severely curtailed by US sanctions.

Private Indian companies purchased very large quantities ofVenezuelan oil with a high of around 4,25, 000 barrels per day in 2015. Thiscame down by around 1,00,000 barrels per day last year but now is expected todry up almost completely. Despite taking financial hits no oil company wants toincur the danger of US sanctions because of their enormous interests in the US.Clearly, the government is going along with the commercial interests of theprivate companies in the expectation that reductions in Venezuelan oil will becompensated through increased production of other oil producers.

In this unequal world many countries have to adjust to theinterests of the great powers. This truth is borne out by history.

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