The World Is Done Waiting for Guaidó

The world may widely recognize strongman Nicolás Maduro as Venezuela’s leader now, but there was a time when around 60 governments named someone else: Juan Guaidó. After declaring himself interim president in January 2019, the opposition leader led a charge to unseat Maduro that drew international support and fueled hopes of political change—at least initially. 

Four years later, Guaidó’s bid has officially collapsed, with opposition lawmakers voting him out of power late last month. With key questions of legitimacy and recognition swirling in the wake of his removal, the resulting fallout threatens to further complicate the U.S. strategy toward Venezuela, in which Guaidó was once an interlocutor. Also at stake are billions of dollars worth of overseas assets that his interim government had controlled. 

“It’s really a little bit crazy and unprecedented,” said Francisco Monaldi, a Latin American energy policy expert at Rice University, who described the resulting wrangle for assets as a “legal monster.” “It’s very, very rare to have this situation in which a few Western countries recognize a parallel government … that really didn’t have any powers within the country.” Even with Guaidó out, the United States and United Kingdom do not formally recognize Maduro’s authority.

Analysts describe the demise of Guaidó’s interim government as a slow, drawn-out death, a botched bid that had run its course after staggering along with no off-ramp. Unable to weaken Maduro’s grip, the parallel government ultimately lost support and sputtered into an unworkable system—all while Maduro arguably strengthened his hand. 

“The Guaidó government had become basically a fiction,” said Christopher Sabatini, a senior fellow for Latin America at Chatham House. “I mean, it couldn’t do anything.”

But it did control a bounty of overseas assets—including U.S. oil refiner Citgo and gold held in England—the future of which are now uncertain with Guaidó out of the picture. Opposition leaders have insisted that the assets will stay out of Maduro’s hands, although experts say the courts will now likely determine their ultimate fate. “From the legal standpoint, it really opens up a whole Pandora’s box,” said Francisco Rodríguez, a Venezuelan economist and professor at the University of Denver. 

Home to the world’s largest oil reserves, Venezuela was once a powerful oil-producing giant, churning out as many as 3 million barrels of crude oil per day at its peak. But with extreme mismanagement and corruption, the country’s oil industry steadily collapsed, wreaking economic havoc and a disastrous humanitarian crisis that has displaced millions of people. 

“The resources are obviously there, so it’s not a geological problem,” said Fernando Ferreira, a global oil market expert at Rapidan Energy Group, who noted that significant investment will be necessary for production to come back online. “It’s really just an aboveground issue with sanctions, with mismanagement, and corruption.”

This decay was accelerated under the Trump administration, which unveiled sweeping oil sanctions in a bid to pressure and ultimately push out Maduro. The Biden administration, while continuing to formally recognize Guaidó, has struck a different tone. As Russia’s chokehold over Europe’s energy supply plunged much of the world into crisis in 2022 and as Western sanctions on Russian oil helped push up crude and gasoline prices globally, Washington also began to ramp up its engagement with once-pariah producers. Washington ultimately gave Chevron a license to pump oil there again on the condition that Maduro returned to talks with the opposition.

“We have certainly eased our sanctions, and when we get to a point where we no longer have the figure of an interim president, the implication is that there must be another president,” said Kevin Book, managing director of ClearView Energy Partners. “And even though we do not recognize that president—that’s not our official policy—it does suggest some degree of rapprochement.”

Washington’s calculus could continue to shift in the coming months, especially as the fractured Venezuelan opposition scrambles to carve out a new strategy and secure guarantees for fair elections ahead of a scheduled vote in 2024. If the opposition continues to splinter, Rodríguez said, U.S. involvement in Venezuelan politics could shrink. “The more divided that the Venezuelan opposition is, the more reasons there will be for the Biden administration to progressively disengage from Venezuela,” he said. 

The resulting fallout could also alter dynamics within Washington, namely among lawmakers who have been pushing to intensify pressure on Maduro, rather than court his regime as a source of succor for the world’s energy woes. “One area of instability is the degree to which hawks and, in particular, Republican hawks start to sour tangibly on the Biden administration’s pragmatic liberalizations,” Book said.

Last November in Mexico City, delegates representing Maduro and the opposition agreed to allocate around $3 billion in frozen Venezuelan funds toward United Nations-administered humanitarian assistance. Experts say distribution of that aid will serve as a major test of negotiations and the Biden administration’s next steps. “Whether there’s progress on that front, I think, will be an important indication of Maduro’s intent,” said Cynthia Arnson, a distinguished fellow at the Wilson Center, who added that no date has been set for the next round of negotiations.

But with a presidential election looming in 2024, Maduro may be even more wary of risking his hold on power, Monaldi said. 

“Maduro clearly is interested in getting sanctions relaxation, but on the other hand, he’s not willing to give up in any significant way his hold on power,” he said. “Clearly, the U.S. is interested in advancing this opening towards Venezuela, but I think it’s very fragile.”