MEXICO CITY — Mexico’s government has begun studying the possibility of stepping in to replace Venezuelan oil program Petrocaribe if the government of President Nicolas Maduro were to fall, three officials with knowledge of the plan told Reuters.
Discussions on how to design credits through which Mexico could sell low-cost crude and oil products to Petrocaribe clients in the Caribbean and Central America are just a few weeks old, according to two of the officials, and involve the finance ministry, the foreign ministry and the energy ministry.
Venezuela’s Petrocaribe scheme, launched in 2005, has furnished about a dozen Caribbean states with oil supplies under a flexible credit mechanism, obliging them to pay cash for part of every shipment, and finance the rest at low interest rates, or buy it with goods like food and clothing.
A collapse in oil prices, however, has caused a major recession in Venezuela and Maduro’s government has faced months of deadly protests and splits within his administration amid growing international pressure from critics who allege he has formed a dictatorship.
Two officials said Mexico’s finance ministry and foreign ministry, which have taken the lead on the project of supplying oil to Petrocaribe, see the plan as a way for the world’s 11th biggest oil producer to acquire regional allies.
The energy ministry, however, is more cautious, with major concerns about Mexico’s current levels of crude oil production, which have been falling for 13 years, and declining output of refined products, the two sources said.
Petrocaribe nations’ loyalty to Venezuela has prevented Mexico and allies from winning enough votes to censure Venezuela in the Organization of American States diplomatic bloc.
Even though the plan is in its infancy and may not come to fruition, talk of it could chip away at Maduro’s already weakened support. It is also a fresh example of Mexico leading U.S.-backed, Latin American efforts against Maduro’s government.
Mexico has ditched years of hands-off foreign policy to helm the push against Caracas in the hope that its efforts will be recognized during the crucial renegotiation of the North American Free Trade Agreement, U.S. and Mexican officials say.
The foreign ministry denied any such plan. Foreign Minister Luis Videgaray on Tuesday met Mexico’s envoy to Venezuela “to set the course of action” for the country, the ministry said in a news release.
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