U.S. Imposes Sanctions On State-Owned Venezuelan Oil Giant

The United States has hit Venezuela's state-owned oil company with new economic sanctions, as Washington turns up the pressure on embattled President Nicolas Maduro.

The move, announced January 28, followed the decision by Washington, and a growing number of other countries, to no longer recognize Maduro as Venezuela's legitimate leader.

Venezuela is one of the world's largest oil producers, and the state-owned company, Petroleos de Venezuela SA, has been a critical source of hard currency, bolstering Maduro's presidency even as the country has sunk into economic chaos.

The new sanctions don't ban U.S. imports of Venezuelan oil -- the U.S. market is Venezuela's largest export market.

However, the measures block U.S. companies from doing financial transactions with the company, known by its acronym, PDVSA.

That means that any payment for Venezuelan oil imports will go to blocked bank accounts, according to a statement issued by Treasury Secretary Steven Mnuchin.

In a televised meeting with diplomats, Maduro criticized the U.S. move.

"These are illegal, immoral, criminal acts," news agencies quoted him as saying.

The move also has implications for Citgo, a U.S.-based company that is a subsidiary of PDVSA.

U.S. officials may seek to turn over control of PDVSA to allies of Juan Guaido, Maduro's rival and a prominent opposition figure whom Washington and other nations have recognized as Venezuela's leader.

If that happens, Maduro may stop paying back loans to the Russian state-owned oil company Rosneft.

That in turn could prompt Rosneft to exercise a contract clause that would give it 49.9 percent control of Citgo.

With reporting by AP