On April 5, 2019, the Trump administration announced its decision to issue sanctions against 34 ships owned or operated by Petroleos de Venezuela, S.A., the state-run oil company. The administration also levied sanctions against two international companies that ship Venezuelan oil to Cuba. Days later, on April 8, the Trump administration issued another ruling against Cuba, prohibiting Cuban athletes from playing in the MLB unless they defected. Although MLB officials asserted that they worked closely alongside the Treasury Department in 2018 before signing any sort of agreement with Cuba, the Trump administration displayed no hesitancy in striking down such a deal. Both of these decisions, which took place within a week of each other, reveal a new, serious strategy of the Trump administration: to pressure Venezuela and Cuba.
While the Trump administration has unquestionably issued these sanctions to further tighten the financial stranglehold on Venezuela, one primary objective of these levies is to cut off the oil trade to Cuba. On average, Venezuela ships Cuba 20,000 to 50,000 barrels of oil a day. In response, Cuba shares intelligence and counterintelligence services with them.
This relationship is founded in history. Although Venezuela proved a close ally of the U.S. during the Cold War, that position changed when Hugo Chavez rose to the presidency in 1999. Chavez, who viewed Cuba’s Fidel Castro as a sort of mentor, sought to aid the state, which had been struggling economically due to U.S. sanctions and the collapse of its long-time ally – the Soviet Union. After nearly falling victim to a coup attempt in 2002, Chavez eagerly embraced a new relationship with Cuba. In return for providing the Caribbean country free and subsidized oil, Cuba would offer Venezuela intelligence and military assistance, as well as doctors and teachers. Under Chavez’s successor, Nicolas Maduro, oil shipments to Cuba climbed as high as 100,000 barrels a day. Yet the number of Cuban operatives in Venezuela, as well as what role those operatives are acting in, remains a subject of debate. The Trump administration alleges that 20,000-25,000 Cuban individuals are serving in Venezuela’s military and intelligence services, as well as Maduro’s private guard. The Cuban government, which asserts that the number is 20,000, has stated that nearly all Cuban personnel in Venezuela are working in humanitarian roles, specifically as doctors and teachers.
Nevertheless, the Trump administration is anxious to limit Cuba’s role of influence in Venezuela however possible. In a statement on April 5, Treasury Secretary Steven T. Mnuchin made this clear, noting,
“Cuba has been an underlying force fueling Venezuela’s descent into crisis. Treasury is taking action against vessels and entities transporting oil, providing a lifeline to keep the illegitimate Maduro regime afloat. Cuba continues to profit from, and prop up, the illegitimate Maduro regime through oil-for-repression schemes as they attempt to keep Maduro in power. The United States remains committed to a transition to democracy in Venezuela and to holding the Cuban regime accountable for its direct involvement in Venezuela’s demise.”
To continue this pressure, the Trump administration announced – just three days after their implementation of sanctions – that Cuban athletes could not play in the MLB unless they defected from Cuba. On December 19, 2018, the MLB Players Association and the Cuban Baseball Federation (FCB) signed a deal that made is possible for Cuban nationals to play in the MLB without defecting from their home country. Similarly to agreements with Japan or Korea, the FCB would streamline the process for players joining the MLB, while retaining approximately 15-25% of their financial earnings. The MLB pursued this deal because, under the sanctions regime, Cubans must go to dangerously great lengths to play baseball in the U.S., often working with – and falling victim to – the ploys of smuggling syndicates. The MLB received legal authority to carry out such a deal in 2016, when the Treasury Department’s Office of Foreign Assets Control (OFAC) granted them a license to enter into a business arrangement with the FCB. Even though the Trump administration displayed skepticism of the deal’s legality up until its signing, OFAC nevertheless assured the MLB that the license was still valid.
The Trump administration’s ruling on April 8 overruled that assurance. Justifying their decision, a Trump administration official argued that the Obama administration inadequately interpreted the law. Additionally, they claimed that the Cuban government was taking part in human trafficking. Citing “facts recently brought to their attention” and discussions with the State Department, OFAC instead decided to prohibit the deal. OFAC further claimed that the FCB was tied to the Cuban government, and therefore ineligible to receive payments from U.S. businesses like the MLB. While such financial arrangements were possible under the Obama administration, the Trump administration has pulled a sharp one-eighty, implementing sanctions and embargos, while offering fiery rhetoric.
The Trump administration has made no secret of the fact that these rulings – the imposition of sanctions on April 5 and the overruling of the MLB-FCB agreement on April 8 – are direct retaliatory measures for Cuba’s assistance to the Maduro regime. When asked on Fox News if the MLB ruling was meant to pressure Cuba, Secretary of State Mike Pompeo replied, “Yep.” He further stated that the administration was “going to do everything we can to pull [Cuba] out” of Venezuela.
The timing of these decisions is by no means a coincidence. As the Trump administration is desperate to unseat Maduro as President of Venezuela, the U.S. is attempting to weaken his regime however possible. But even this has become more complicated, as Russia recently sent 100 military personnel to Venezuela offer technical assistance, dramatically disrupting any U.S. decision to pursue further involvement in the region. Since the administration has made clear from its first day in office how deeply it opposes Cuba’s regime, this mutual pushback against Venezuela and Cuba can be regarded as a sort of two-for-one deal. Yet it remains to be seen how effective these measures will prove in their effort to pull Cuba out of Venezuela. With a relationship rooted in over two decades of history, both regimes – who are desperate to hang onto power in times of economic trouble – will continue to oppose the Trump administration. Russia’s willingness to get involved in the region, regardless of the scale of such involvement, will further bolster the confidence of Cuba and Venezuela, while forcing the U.S. to deeply consider how they wish to proceed.