By Jessica Donati, Andrew Restuccia and Ian Talley
The Trump administration's bid to replace Venezuela's
authoritarian leader Nicolás Maduro hit a roadblock after a meeting
with Russian officials in Rome last year -- and has never
recovered.
U.S. envoy Elliott Abrams arrived at the Westin Excelsior hotel
hoping to persuade Russia to withdraw its support for Mr. Maduro
and to recognize Juan Guaidó as Venezuela's legitimate leader.
Russian deputy foreign minister Sergei Ryabkov instead demanded the
U.S. back down from military threats and lift the economic
sanctions intended to force Mr. Maduro's hand.
In the months that followed, the U.S. campaign spiraled into a
foreign-policy debacle, thwarted by familiar adversaries, Russia
and Cuba, as well as allies, Turkey and India -- all countries that
one way or another helped Venezuela sidestep U.S. sanctions,
according to current and former U.S. officials and Venezuelan
opposition activists. The European Union watched from the
sidelines.
The Trump administration, confident Mr. Maduro would fall,
didn't foresee Russia leading the way for other countries to
eclipse the sanctions. In turn, administration reluctance to impose
sanctions on Russian enterprises and others kept Venezuela's oil
and gold flowing to buyers.
This month, in a sign of how much the opposition is floundering,
Venezuela security forces blocked Mr. Guaidó from entering the
National Assembly building, where he was seeking re-election as
leader. Mr. Guaidó, in a blue suit, tried and failed to scale the
spiked iron fence.
Russia now handles more than two-thirds of Venezuela's crude
oil, current and former administration officials said, including
helping to conceal export destinations. The lifeline has helped Mr.
Maduro slow the economy's free fall, consolidate his grip on power
and weaken the opposition.
Almost half of the $1.5 billion in Venezuelan crude exported to
India in the nine months after the U.S. sanctions was purchased by
an Indian joint venture with Russia's oil giant, Rosneft, according
to a Wall Street Journal analysis of data compiled by trade
database Import Genius.
The United Arab Emirates has imported around $1 billion in gold
from Venezuela since gold sanctions were imposed in late 2018,
according to Venezuela trade records. U.S. intelligence officials
say the actual amounts are far higher, based on evidence that
Venezuelan gold is leaving the country masked as originating from
Colombia, Uganda and elsewhere. The exports land in Turkey, the
U.A.E. and other gold-trade hubs.
The Turkish embassy in Washington denied any oil or gold trade
with Venezuela that breached U.S. sanctions. "The allegations do
not reflect the facts, and they are only speculative and hearsay,"
a spokesman said.
The Russian embassy in Washington declined to comment. It
referred to past foreign ministry statements criticizing the U.S.
for interfering in Venezuela's affairs. Officials from India and
the U.A.E. didn't respond to requests for comment.
Administration officials acknowledge President Trump's
frustration and say the White House continues to press for Mr.
Maduro's ouster. Mr. Trump, pointing to America's superior economy
and military, suggested in a recent interview with the Journal that
the U.S. had the resources to outlast Mr. Maduro. "We have a lot of
options," the president said.
Yet with an election, impeachment and attention turned to the
Middle East, Venezuela has for now moved to a back burner, an
administration official said.
The stalemate allows Mr. Maduro to take a star turn as David to
America's Goliath. He makes speeches and appearances nearly every
day to show he remains comfortably in charge. He chided Mr. Abrams
and other U.S. officials, saying they misled Mr. Trump that a
regime change would be easy.
"They're trying to save their jobs because Trump is furious with
the lies they've fed him on Venezuela," Mr. Maduro said in a recent
address. "They failed, and Venezuela triumphed."
Mr. Maduro's hold on the presidency has been costly for what was
once Latin America's most-prosperous economy. Hyperinflation, high
infant mortality rates and a shortage of medical supplies
contribute to the humanitarian crisis there. Food, electricity and
water shortages have driven an exodus of 4.5 million people.
Mr. Abrams, the U.S. envoy, acknowledged this month that the
yearlong U.S. effort to remove Mr. Maduro has stalled. "We
underestimated the importance of the Cuban and Russian support for
the regime," he said. "The Russian role in the economy,
particularly the oil economy, is larger and larger."
Mr. Guaidó, in an interview, sounded a similar note. "I think we
did underestimate things," he said. He called on countries to help
block gold exports from Venezuela. "You have to try to bring
pressure on those who support the regime," he said. "Sanctions
today are the only real tool we have."
Mr. Guaidó's approval rating had fallen by more than 20 points
to 38%, according to Venezuelan pollster Datanalisis. Allegations
against opposition members, including accepting bribes from Maduro
cronies, have eroded confidence.
Despite the setbacks, administration officials said there are no
plans to abandon Mr. Guaidó. Vice President Mike Pence last month
summoned senior administration officials to a meeting in the White
House's Situation Room. U.S. officials later hosted a conference
with opposition leaders to try to reinvigorate them, people
familiar with the gathering said.
Mr. Guaidó's backers see Russia as their principal obstacle and
want the U.S., Europe and other allies to take a harder line on
sanctions loopholes.
"Russia in my view has become the most important partner of
Maduro," said Carlos Vecchio, the Venezuela ambassador to the U.S.
for Mr. Guaidó. "A multilateral approach on sanctions is
critical."
The EU hasn't introduced sanctions or prevented Maduro officials
from traveling to the eurozone to raise money and support.
Charles Shapiro, a former U.S. ambassador to Venezuela who is
now president of the nonpartisan think tank World Affairs Council
of Atlanta, said the Trump administration's predicament showed the
difficulty of regime change without military force.
"And if you use military force," he said, "there are all sorts
of other problems."
The U.S. has warned officials in Russia, Turkey, the U.A.E. and
India about sanctions violations in private meetings, U.S.
officials said, but hasn't moved to blacklist companies or
individuals suspected of breaking the sanctions.
Policy options have split the administration. Some officials
believe sanctions on Russia's oil firm Rosneft and other companies
doing business with intermediaries could close loopholes that have
allowed Mr. Maduro to survive.
Others say they could undermine U.S. interests elsewhere,
including Iran. India agreed to stop importing Iranian crude as
part of Washington's pressure campaign against Tehran, but it
continues to import Venezuelan oil. India pays for the deliveries
in gasoline, a trade that the nation says doesn't violate U.S.
sanctions.
Secretary of State Mike Pompeo hasn't ruled out negotiations
with Mr. Maduro.
"We will continue to tweak our policy to get the strategy just
right, but we've seen no evidence that Maduro is remotely
interested in having free and fair elections," Mr. Pompeo said
recently about direct talks. "As far as our strategy, the tack
we'll take, I'm sure that will change over time."
Long road
Mr. Guaidó, 36 years old, was virtually unknown in Mr. Trump's
circles before he came to Washington with a delegation in December
2018. Administration officials and opposition leaders made a plan
to put Mr. Guaidó in charge, and Mr. Pence was given a central
role.
Administration officials targeted Venezuela, in part to punish
Cuba and win support among Cuban Americans, a potent Republican
voting bloc in Florida. Republican Sen. Marco Rubio of Florida and
Mauricio Claver Carone, the National Security Council's head for
Latin American affairs, had roles in forging Venezuela policy.
Cuba provides Mr. Maduro with intelligence and security
services, helping to minimize defections in his government, U.S.
officials said.
When Mr. Guaidó declared himself interim president in a widely
watched oath of office ceremony a year ago, the U.S. swiftly
recognized him as Venezuela's legitimate leader. Canada, Brazil,
Argentina, Colombia, Chile, Peru and other South American countries
followed. They supported Mr. Guaidó on the grounds that Mr.
Maduro's election to a second six-year term was a sham.
Two days after Mr. Guaidó's oath, Mr. Abrams was appointed as
the top envoy to Venezuela. He was given one job: Remove Nicolás
Maduro.
Mr. Abrams rattled some at the State Department, in part for his
involvement in the Iran-Contra affair, a covert operation in the
mid-1980s to sell weapons to Iran and use the proceeds to arm
rebels in Nicaragua.
Some career State Department staff feared that any heavy-handed
U.S. intervention would derail Mr. Guaidó's popular support, while
political appointees questioned Mr. Abrams's support of Mr.
Trump.
In March, Mr. Abrams met with the Russian deputy foreign
minister in Rome. After Russia refused to back Mr. Guaidó, the U.S.
envoy promised more sanctions and possible military action.
The realization that regime change wouldn't be easy came in
April. The opposition planned to have Venezuela's top court
recognize the National Assembly, headed by Mr. Guaidó, as the
legitimate representative of the Venezuelan people. That would give
the country's armed forces legal grounds to abandon Mr. Maduro.
Guaidó supporters expected high-ranking Maduro officials to
announce they were switching sides. The plan flopped, and White
House frustrations erupted.
In May, secret talks brokered by Norway opened in Barbados
between Mr. Maduro and the opposition, which called for fair
elections. In August, Mr. Maduro quit the talks.
Looking back, the U.S. campaign originated with unrealistic
expectations, current and former U.S. officials and Venezuelan
opposition activists said.
"There was a firm belief, and briefed to the president, that all
that had to be done was to recognize Guaidó, and Maduro would
fall," said Fernando Cutz, a former White House National Security
Council official during the Trump and Obama administrations who was
involved in U.S.-Venezuela policy.
The administration's call for the Venezuelan military to defect
and support Mr. Guaidó was wishful thinking, said Michael Shifter,
president of the Inter-American Dialogue, a nonpartisan think tank:
"The last thing the military are going to do is follow orders from
a foreign power, especially the U.S."
Mr. Trump complained to aides and allies that he was led to
believe Mr. Maduro would be removed quickly, people familiar with
the matter said.
The president directed much of his anger at national security
adviser John Bolton, those people said, adding that those
frustrations contributed to Mr. Bolton's ouster in September.
Helping hand
With Russia's help, Venezuelan oil output could return to 1
million barrels a day from a low of 650,000 to 700,000 barrels,
Rapidan Energy Group, a geopolitical risk consulting firm, said in
December. Rosneft is helping Petróleos de Venezuela SA, the state
oil company, pay for overdue maintenance and the hiring of foreign
experts, according to the group.
Russia has provided Venezuela more than $300 million in currency
over the past 18 months -- dollars and euros that have become more
scarce under the sanctions, according to the Journal analysis of
data from Import Genius.
Mr. Abrams said he still believed sanctions will work. "The
situation of the regime is untenable and many people in the regime
clearly know it,' he said. "They would not keep sending their
money, their wives, their children, and their mistresses out of the
country if they thought it was stabilizing."
Cynthia Arnson, director of the Latin American program at the
Woodrow Wilson International Center for Scholars, said the standoff
this month at the National Assembly underscored the opposition's
weakened state.
"At the same time," she said, "the [Maduro] government has no
real options for ending the economic, humanitarian and legitimacy
crises that it faces."
The issue surfaced at a Trump reelection event this month in
Florida, a battleground state with the largest population of
Venezuelans in the U.S. Some of Mr. Trump's supporters in Florida
have voiced frustration that Mr. Maduro remained in power.
Commerce Secretary Wilbur Ross. speaking informally to a small
group at the event, said the administration had expected the
leadership change to happen faster, and that some officials sought
more aggressive efforts, according to a person familiar with
conversation.
A spokesman for Mr. Ross declined to comment on the meeting but
said the administration is looking at all options. "The U.S. is
100% behind Guaidó," Mr. Ross said Thursday in a TV interview.
--José de Córdoba,
Alex Leary
, Kejal Vyas and Vivian Salama contributed to this article.
Write to Jessica Donati at jessica.donati@wsj.com, Andrew
Restuccia at Andrew.Restuccia@wsj.com and Ian Talley at
ian.talley@wsj.com
(END) Dow Jones Newswires
January 27, 2020 10:37 ET (15:37 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.