A Democratic senator has urged the Biden administration to lift a ban on diesel fuel swaps with Venezuela.
Sen. Chris Murphy, a member of the Senate Foreign Relations Committee, wrote a letter to Secretary of State Antony Blinken, stating that restoration of diesel swaps would “provide lifesaving relief for millions of Venezuelans.”
According to the Associated Press, current diesel reserves are expected to run critically low by April.
Murphy writes that the ban “has created no real political leverage with Maduro, who was able to maneuver around the unilateral sanctions, and instead threatens to severely worsen the already dire humanitarian situation in the country.”
In 2019, the Trump administration put pressure on most of Venezuela’s fuel suppliers to refrain from sending gasoline to Venezuela in an attempt to oust socialist President Nicolas Maduro. The move would serve to further paralyze the country’s public transportation system and prevent farmers from moving food supplies to market in diesel-powered trucks.
Oil production has fallen to dire levels and the country’s economy has struggled to recover. More than 4 million people have fled to neighboring South American countries, citing shortages of essential resources such as food and medicine.
Last week, Venezuela rolled out larger-denomination banknotes in response to hyperinflation. Bills worth 200,000 (10 U.S. cents) and 500,000 (27 U.S.cents) at the current exchange rate are being circulated. Venezuela’s central bank said it also planned to roll a bill worth 1 million bolivars — just 52 U.S. cents.
“These new bills will complement and optimize the current denominations, to meet the requirements of the national economy,” the central bank said in a statement.
Maduro has piled pressure on banks to implement digital payment systems while adding that the country needed to demonstrate “fiscal discipline” following years of excessive money printing.
Unless the fuel swap ban is soon lifted, the International Monetary Fund (IMF) predicts that inflation in Venezuela will hit a monstrous one million percent this year.