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CARACAS, Venezuela (AP) — The Trump administration is threatening to take "strong and swift economic actions" if Venezuelan President Nicolas Maduro proceeds with his plan to rewrite the nation's constitution and consolidate power over the few remaining institutions outside the control of the ruling party. A senior administration official said this week that "all options are being discussed and debated," implying that Trump could use Venezuela's dependence on oil exports to the U.S. as a means of pressuring Maduro to halt the July 30 constitutional assembly.
WHAT'S AT STAKE?
Oil-rich Venezuela has been plunged into political and economic turmoil as petroleum prices plummet, nationalized farms and factories halt production and corruption runs rampant. More than three months of street protests have left at least 93 people dead.
Maduro has called for the election of the special assembly to rewrite the country's 1999 constitution. Opposition members fear it will create a single-party, authoritarian state along the lines of the system in Cuba, a close Maduro ally.
A coalition of opposition parties said it garnered more than 7.5 million votes in a symbolic national vote against the assembly on Sunday, though the number couldn't be independently confirmed. The European Union, Germany, Brazil, Canada and Mexico also have called for the constitutional rewrite to be canceled.
WHAT IS TRUMP THREATENING?
President Donald Trump said in a statement Monday that "the United States will not stand by as Venezuela crumbles. If the Maduro regime imposes its Constituent Assembly on July 30, the United States will take strong and swift economic actions."
A senior administration official, speaking on condition of anonymity, said in a briefing for reporters Tuesday that "the President told us to consider all options, so options are on the table" but declined to provide any details.
Sen. Marco Rubio, who has worked with the Trump administration on Latin American issues, has indicated on Twitter that the U.S. could act against Diosdado Cabello, the powerful vice president of Venezuela's ruling party. Rubio and other U.S. officials accuse him of involvement in drug trafficking. Cabello denies the charge.
WHAT CAN TRUMP DO?
In February, the Trump administration imposed sanctions against Venezuelan Vice President Tareck El Aissami, accusing him of playing a major role in international drug trafficking — a charge he denies. Then in May it imposed sanctions on eight supreme court justices who had voted to strip the opposition-led congress of many of its powers.
Rubio's tweets indicate the administration may be thinking of doing the same for Cabello and other high-ranking Venezuelans. Such sanctions freeze targets' U.S. assets, bar travel to the U.S. and make it illegal for Americans to do business with them. Venezuelan experts say it's not clear if top officials are vulnerable to such measures, but said expanding the list of targets throughout the army hierarchy could force some military officers to reconsider the cost of supporting Maduro's government.
A more powerful and risky weapon is cutting back on U.S. imports of Venezuelan oil.
VENEZUELA, THE U.S. AND OIL
The United States is the primary source of hard currency keeping the Venezuelan government afloat.
Venezuela exports an average of 700,000 barrels of oil a day to the U.S., about half its total exports. Much of the other half serves as payment of debt owed to China, so a total cut in exports to the U.S. would slash Venezuelan government income by 75 percent, Angel Alvarado, a member of congress and economist, told The Associated Press.
Venezuelan oil accounts for about 10 percent of U.S. oil imports, and Miguel Tinker Salas, an expert in Venezuela history at Pomona College in California, said U.S. officials likely fear that any disruption in the oil market would increase gasoline prices in the U.S.
There is also skepticism over whether economic sanctions would effectively encourage a political opening.
"There has been a lot of talk about raising the stakes of Venezuela but the one thing they have not touched is oil imports," he said.
Venezuela could potentially redirect exports to other markets, though few have matched the massive investments made by several U.S. refineries that are needed to process Venezuela's high-sulfur, high-density crude.
The chairman of the port of Corpus Christi, Texas, said in a letter to Trump restricting Venezuelan crude could have a "significant" impact the area's refineries.
But Antoine Halff, an oil-markets expert at Columbia University, said that crude imports from Venezuela already are down and there are large inventories of crude in the U.S. and worldwide, so blocking Venezuelan crude wouldn't have a major effect on U.S. motorists. "A ban would not cause any supply shortfall," he said.
While starving Venezuela of oil revenues could debilitate the Maduro government, it could also produce something resembling state collapse in Venezuela, where armed men already roam with impunity and tens of thousands of people have been fleeing the country.
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Fabiola Sanchez in Caracas, Christine Armario in Miami and David Koenig in Dallas contributed.
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Michael Weissenstein on Twitter: https://twitter.com/mweissenstein
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