US says Venezuelan crisis could drag on: Update

Adds details throughout

The US administration is preparing for the government transition in Venezuela to take "weeks and months" and says oil sanctions imposed on state-owned PdV will not have negative effects on US refiners.

The combination of US financial sanctions and protests in Venezuela are putting pressure on sitting president Nicolas Maduro's circle "that will eventually bring about an end to Maduro's reign of terror," State Department special envoy Elliott Abrams said today.

But he declined to say when the US expects Maduro to step down and pave way for National Assembly speaker Juan Guaido — whom the US and more than 50 other countries recognize as acting president — to take over.

"While it is impossible to predict the moment this will happen, we believe the current political and economic environment is unsustainable and that he will not be able to weather it much longer," Abrams told the House Foreign Affairs Committee.

The US administration and its Latin American allies are hoping humanitarian aid deliveries to Venezuela will sway the country's military forces to back Guaido's government. Guaido has pledged that humanitarian aid will enter the country on 23 February.

The pledge establishes a de facto deadline for Maduro and the armed forces that support him to stand down. It is unclear how significant aid could be imported into Venezuela if the borders remain blocked by the military, setting the stage for a potential confrontation.

February 23 is an important day for another reason: it marks the one-month anniversary since Guaido took the oath of office. The Venezuelan constitution requires that an acting president call for new elections within a month. If Guaido misses the 30-day mark, he could be targeted for detention, as the Maduro government has already done with numerous opposition leaders.

But Abrams downplayed the deadline's significance. Missing it would be Maduro's fault, not the opposition's, Abrams said. "Over the next weeks and months, the international community will take full advantage of the momentum built over the last few weeks."

House Foreign Affairs Committee chairman Eliot Engel (D-New York) credited the administration with "multilateral engagement to grapple with this crisis." But he said US officials should plan for the possibility that Maduro does not leave office soon. "The White House must think through the potential repercussions that these sanctions could have on the Venezuelan people," if Maduro remains in power, Engel said.

Abrams downplayed the negative effect of US sanctions on Venezuela's humanitarian situation. "The money US was paying to PDVSA was not going to the Venezuelan people," he said.

Engel also warned against a US military intervention, which he said should not be an option.

Abrams said a military intervention is not the administration's preferred option.

But President Donald Trump, during a meeting with Colombian president Ivan Duque at the White House, said "there are a number of different solutions and we look at all options." Trump added that the US and Colombian armed forces "are very focused and working together — let us see how it all turns out."

Duque made no mention of a possible use of the military, merely saying that joint diplomatic pressure on Venezuela is working "like no time before."

The oil sanctions Washington has imposed have given US refiners until 28 April to wind down purchases of Venezuelan oil and immediately cut exports of US-sourced diluents required to keep a large chunk of Venezuelan exports flowing.

The administration has said it would only remove sanctions on PdV if Maduro steps down and hands over power to Guaido or a government that comes to power through free elections. Deputy assistant secretary of state Sandra Oudkirk told the House panel today that sanctions relief for PdV could occur "through the expeditious transfer of control of the company so that it is no longer a tool for the former Maduro regime's illegitimate uses."

The oil sanctions are unlikely to cause disruptions since oil markets are adequately supplied, Oudkirk said. Oudkirk, who is the deputy chief of State Department's energy bureau, told lawmakers US refiners can access the same type of heavy sour crude that Venezuela produces from Mexico, Ecuador, Colombia, Canada and the Middle East. "While there may be a short-term adjustment period, we do not assess that this adjustment will have a sustained negative impact on the US refineries that import Venezuelan oil."

The US Gulf coast refineries are expected to ask the Treasury Department's Office of Foreign Assets Control for licenses providing specific relief from sanctions, and such applications will be processed quickly, Oudkirk said.

US sanctions already are making it difficult for PdV to export oil but "headline benchmark crude oil prices have hardly changed on news of the sanctions," the IEA said today. The US alone is expected to increase output by more than Venezuela's current output, but that does not factor in the different grades of crude produced by the two countries, the IEA warns. "With heavy barrels being removed from the market, refiners have to pay more."