The Treasury Department made it easier Friday for U.S. businesses and farmers to buy Venezuelan fertilizer and oil as their prices rise because of the Iran war, Axios has learned.
Why it matters: The bottleneck of tankers in the Persian Gulf because of Iranian attacks has caused the costs of oil and fertilizer, a petrochemical product, to jump. It threatens to spike inflation and raise the cost of food in the U.S.
- By reducing sanctions on oil-rich Venezuela, Treasury Secretary Scott Bessent hopes to increase supplies in the U.S. and lower prices.
Zoom in: The Office of Foreign Assets Control, which manages sanctions, took separate actions that authorized U.S. business and farmers to:
- Purchase and import Venezuelan petrochemical products such as fertilizer and oil;
- Provide goods, services or technology to support Venezuela's electricity and petrochemical sectors, and
- Negotiate new contracts to develop Venezuela's oil and natural gas supplies or modernize and improve its electric grid to help increase oil production.
Zoom out: Bessent's action is part of an ongoing effort to reintegrate the U.S. and Venezuela economies after the U.S. ousted Venezuela's strongman, Nicolas Maduro, on Jan. 3.
- The Iran war intensified the Trump administration's focus on Venezuela to help offset the global crunch in oil and fertilizer, a major concern of U.S. farmers.
- Besides importing more oil, the U.S. recently struck a massive gold deal with Venezuela.
What they're saying: "These authorizations expand permitted investment and activities in Venezuela's energy industry and allow for the export of fertilizer directly to the U.S. to support our great American farmers," a U.S. Treasury official said.
