DECISION TIME ON VENEZUELA: The six-month waiver allowing Venezuela to export oil to the U.S. is set to expire tomorrow – and it’s not looking likely the Biden administration is going to renew sanctions relief for the country ahead of the deadline.
An explainer: In October, the U.S. had partially lifted sanctions on Venezuela to authorize transactions in oil, gas, and gold. The relief was in response to a deal between the country’s government and its opposition, in which the two sides agreed to work together to reach a series of conditions for the next presidential election, including allowing the opposition to run in the upcoming July election.
But Venezuela President Nicolás Maduro has since blocked his chief opponent – Mariá Corina Machado – from being on the ballot, arrested members of her staff, and obstructed Venezuelan emigrants from voting in elections.
Since then, the Biden administration has seemed to lean toward reinstating sanctions against Venezuela. Just this past week, a State Department spokesperson told Reuters that, absent any progress made by Maduro and the Venezuelan government, the U.S. would not renew the temporary license allowing for oil and gas sales.
Republicans are for it: GOP Sens. Dan Sullivan, Jim Risch, Bill Hagerty and others asked President Joe Biden not to renew sanctions relief, arguing that appeasing dictators such as Maduro can undercut efforts to ensure fair elections in Venezuela.
“We must not cede American leverage by lifting U.S. sanctions while the Maduro government deliberately disregards its obligations,” the senators wrote in a letter sent Friday and made public yesterday. They warned that easing sanctions risked emboldening China, Iran, and Russia.
But, the downsides: If the Biden administration decides to crack down further on Venezuela oil flows, that could result in higher gas prices – an election pain point that Republicans have been pressing down on as inflation becomes one of the main issues the White House has to grapple with during Biden’s reelection bid.
Furthermore, the White House has reasoned that sanctions relief could help soften the economic crisis in Venezuela, and slow the pace of Venezuelan migrants heading to the southern U.S. border. The border chaos is another key election issue Biden will have to face in his match-up against former President Donald Trump.
Welcome to Daily on Energy, written by Washington Examiner Energy and Environment writers Breanne Deppisch (@breanne_dep) and Nancy Vu (@NancyVu99). Email bdeppisch@washingtonexaminer dot com or nancy.vu@washingtonexaminer dot com for tips, suggestions, calendar items, and anything else. If a friend sent this to you and you’d like to sign up, click here. If signing up doesn’t work, shoot us an email, and we’ll add you to our list.
MANCHIN JOINS TIM SCOTT RESOLUTION TO OVERTURN SEC CLIMATE RULE: Sen. Joe Manchin joined Sen. Tim Scott today in an effort to overturn the Securities and Exchange Commission’s climate disclosure rule, our Zachary Halaschak reports.
So far, Scott’s resolution has earned 34 co-sponsors in the chamber, though Manchin is the only Democrat to sign on.
What’s next: The Congressional Review Act allows resolutions to be brought to the floor through an expedited process—meaning it cannot necessarily be held up by Sen. Chuck Schumer, and every senator will be put on record.
JAPAN OIL REFINERS TO TAP RESERVES IN CASE OF MIDDLE EAST DISRUPTION: Japanese oil refiners are planning to use the country’s oil reserves in case of a supply disruption in the Middle East, the head of Japan’s oil association said today.
The president of the Petroleum Association of Japan, Shunichi Kito, said today at a press conference he did not expect any long-term disruption from the Iranian counterattack on Israel, but that any such supply problem would pose a serious challenge for Japan, which relies on the Middle East for some 95% of its oil.
“In case of any disruption in crude oil supply, it is important to be prepared by making flexible use of the oil reserve to ensure that the oil supply will not be disrupted,” he said.
Japan’s emergency oil reserve has enough supplies to last the country 240 days in the event of a complete supply halt or other emergency.
Kito said that Japan is also looking into the possibility of purchasing crude from West Africa and North America to help substitute supplies in the event of a long-term disruption. Read more from Reuters here.
BIDEN’S PUSH FOR WORLD BANK FUNDS TO COMPETE WITH CHINA STALLS: A plan championed by President Joe Biden and other White House officials at last year’s G-20 meeting to raise money for the World Bank to counter China’s lending to developing nations has stalled, in what some see as a blow to U.S. leadership.
As Bloomberg reports, the plan had been pitched at the September G-20 meeting in New Delhi. There, U.S. officials had outlined a plan to send $3.3 billion to the World Bank and its new president, Ajay Banga, as a tool to counter Chinese lending practices around the world.
The capital would be used to generate more than $25 billion in U.S.-backed funding for financing and grants for developing countries, Bloomberg notes, and was part of a broader plan to increase World Bank resources by $200 billion.
But the plan has failed to win approval within the G-20 or the G-7. The move would also require congressional authorization, and Republicans remain opposed to the effort in part because of the Biden administration’s efforts to have the World Bank focus on climate change.
As Bloomberg reports, the lack of progress on the fund has raised questions about U.S. leadership within international institutions like the World Bank, and how Washington’s outsize focus on China is hurting these multilateral bodies. Read more on the slowed effort here.
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