The United States’ seizure and sale of Venezuelan oil, while surprising, could offer a short-term boost to the struggling economy of the South American nation. This week, interim President Delcy Rodríguez announced that Venezuela has received $300 million from Washington’s sale of Venezuelan crude, and those funds are being used to support the battered bolívar, the country’s currency.
The dollars were introduced into Venezuela’s foreign exchange market to help narrow the widening gap between official and informal exchange rates — a disparity that has driven inflation sharply higher. Just the expectation of this injection helped shrink that gap. Analysts say the move is a positive step toward stabilizing the economy, but lasting improvement will depend on a consistent and reliable supply of hard currency. Without this, the bolívar could face further significant depreciation, according to Alejandro Grisanti of the consultancy Ecoanalitica.
In the longer term, he argues, sustainable fiscal policies rather than foreign exchange interventions are necessary to curb inflation.
This week Venezuela’s National Assembly began debating a proposal from Rodríguez to open up the country’s traditionally nationalized oil sector to private investment — a major shift meant to attract foreign capital after the U.S. military’s removal of former President Nicolás Maduro on January 3.
Since decriminalizing the use of the U.S. dollar and lifting strict currency controls to counter prior hyperinflation, the government has injected dollars into the economy whenever possible. But this has grown harder amid a U.S. blockade that has led to the seizure of several Venezuelan oil tankers, tightening dollar availability.
With prices in Venezuela often quoted in dollars but paid for in bolívars, many consumers have sought to benefit from the disparity between official and black-market rates. Following the January 3 capture of Maduro — during which he was flown to the U.S. to face trial — the dollar surged on the black market to more than 900 bolívars before settling to roughly half that level, and Jorge Rodríguez, president of the National Assembly, has urged businesses to adjust prices accordingly.
For ordinary Venezuelans, however, economic relief can’t come soon enough. The minimum monthly wage is below $1, with pensions at roughly the same level, forcing many retirees to choose between buying food or medicine. Union leaders and labor groups have called on the government to use oil revenues to raise incomes and improve social welfare.