WASHINGTON/HOUSTON Mar. 24 (Reuters) - U.S. President Donald Trump on Monday issued an executive order declaring that any country buying oil or gas from Venezuela will pay a 25% tariff on trades with the U.S., while his administration extended a deadline for U.S. producer Chevron to wind down operations in the South American country.
Trump's new policy relieves some pressure on Chevron to quickly exit Venezuela after the U.S. Treasury Department on March 4 gave it 30 days to wind down operations. Trump had issued the initial wind-down after he accused President Nicolas Maduro of not making progress on electoral reforms and migrant returns.
Treasury said on Monday it would wait seven more weeks until May 27 before terminating a license that the U.S. has granted to Chevron since 2022 to operate in sanctioned Venezuela and export its oil to the United States.
Chevron's extension came hours after Trump announced the new tariff, saying Venezuela has sent "tens of thousands" of people to the United States who have a "very violent nature."
The two moves temporarily focus Trump's pressure on buyers of Venezuelan crude oil other than the United States, such as China, though it is uncertain how his administration will enforce the tariff.
David Goldwyn, president of consultancy Goldwyn Global Strategies, said the moves allow a compromise between those in the Trump administration who were concerned about pushing Western companies out of Venezuela and those, including Secretary of State Marco Rubio, who are concerned about enriching Maduro's administration.
"This potentially provides a sweet spot for both of them," Goldwyn said.
Punishing foreign buyers of Venezuela's oil with tariffs could hit its crude exports, forcing price discounts, and have a similar effect to secondary sanctions on the country that Trump imposed during his first term in 2020.
The extension of Chevron's wind-down period would secure payments to the company for oil cargoes delivered to U.S. customers, while avoiding a collapse in crude volumes exported from Venezuela in coming weeks, especially to the U.S., according to analysts and sources.
Trump, who has made illegal migration one of the top priorities of his administration, earlier this month invoked the 1798 Alien Enemies Act to justify the deportation of alleged members of Venezuelan gang Tren de Aragua without final removal orders from immigration judges.
Chevron said it had no comment.
Venezuela's government said it firmly and categorically rejected the "new aggression" announced by Trump.
"This arbitrary, illegal, and desperate measure, far from weakening our resolve, confirms the resounding failure of all sanctions imposed against our country," the Venezuelan government said in a press release.
Photo from Reuters
