US sanctions on Venezuela to hurt world oil market

CARACAS, Venezuela

U.S. sanctions on Venezuelan oil company PDVSA will affect the global market negatively, the oil minister said Monday.

In an interview aired by private broadcaster Televen, Manuel Quevedo, also president of the oil company, commented on U.S. sanctions imposed last week on PDVSA and its U.S. subsidiary Citgo.

Quevedo said US sanctions and trade wars will affect oil prices in 2019.

"What happened to Citgo is totally illegal, a robbery, which was attempted through sanctions," he said.

The South American country has been rocked by protests since Jan. 10 when President Nicolas Maduro was sworn in for a second term following a vote boycotted by the opposition.

Tensions rose when opposition leader Juan Guaido declared himself acting president on Jan. 23, a move which was supported by the U.S. and many European and Latin American countries.

Maduro has so far refused calls to step down accusing the U.S. of orchestrating a coup against his government.

U.S. sanctions announced last Monday on Venezuelan oil companies are likely to cause Maduro economic woes.

Experts say a significant amount of PDVSA’s cash is in U.S. banks.

Venezuela's cash flow will be seriously damaged, say experts, as $7 billion in assets is expected to be blocked, and at least $11 billion in oil revenues will be lost through next year.

Washington also handed over the controls of Venezuelan accounts in U.S. banks to Guaido.

Maduro, who has continued the social policies of late President Hugo Chavez, is believed to be facing a dire economic situation, and cutting aid to the poor is likely to leave him in a difficult spot.

Taking control of oil revenues -- the basis of Venezuela’s economy -- from Maduro and giving it to Guaido, and the decision to sanction oil companies, is the boldest U.S. move so far to raise pressure on Maduro.

Since the beginning of the crisis last month, Turkey has steadfastly stood behind Maduro, saying recognizing Guaido is undemocratic and amounts to promoting a coup.

Russia, China, Iran Bolivia and Mexico also support Maduro.

Reporting by Lokman Ilhan:Writing by Faruk Zorlu