Venezuela Changes Rules, Gold Prices Hit Record Highs – What's the Connection?
On Tuesday (December 23rd), the Venezuelan Parliament approved a new law criminalizing various activities that could disrupt navigation and trade in the country. One of the main provisions of this law is the criminalization of the seizure of oil tankers, which is a direct response to recent measures taken by the United States to seize Venezuelan oil shipments. This US action focuses on blocking vessels connected to the Venezuelan oil sector, causing significant losses to the oil-producing country.
This measure also covers "other international crimes," which are deemed to undermine the stability of international trade and navigation in Venezuelan waters. The Venezuelan government views this US move as an attempt to impede its economic sovereignty, particularly in the management of natural resources, which are the backbone of the country's economy. With this law, Venezuela hopes to better protect its oil industry from external interference.
This decision comes in response to international pressure, particularly from the United States, which has blocked several oil shipments from Venezuela as part of its economic sanctions policy. Venezuela, which has the largest oil reserves The world's largest oil exporters face various challenges in maintaining their oil exports. These US trade-hindering measures further exacerbate Venezuela's already severely depressed economy.
With the passage of this law, Venezuela hopes to address the threat posed by international sanctions and safeguard the viability of its energy industry. Venezuelan officials assert that their country has the right to protect its economic interests from external intervention, particularly in the vital oil sector. On the other hand, the US government views this policy as part of an effort to pressure the government of Nicolás Maduro and influence Venezuela's domestic politics.
Furthermore, the growing tensions between Venezuela and the United States have impacted global energy trade. Venezuela's oil supply, continually hampered by sanctions and trade disruptions, have made the global oil market increasingly vulnerable to uncertainty. This has also impacted crude oil prices, which continue to experience high fluctuations, driven by tensions in the region.
This Venezuelan policy, while attempting to protect the oil industry, has also had a significant impact on global markets, particularly gold prices. Rising geopolitical tensions and energy market uncertainty triggered a surge in gold prices, which reached a new record high on Wednesday (December 24th). Gold prices surged to $4,500 per ounce for the first time in a decade. For the first time, as investors sought safety amid international tensions. The rise in gold prices was also influenced by market predictions that the Federal Reserve would likely cut interest rates, increasing the appeal of the precious metal. This surge in gold prices reflects a shift in investor interest toward safer assets, such as gold, amid growing geopolitical uncertainty. (asd)
Source: Newsmaker.id
