Maduro seen clinging to power despite mounting pressure

Venezuela's embattled President Nicolás Maduro is likely to cling to power in the near term despite mounting pressure on his regime from home and abroad, according to Oxford Economics.

Even a "high probability" of new US sanctions that target Venezuela's oil industry is unlikely to break the government's resistance as it benefits from the support of the local armed forces, as well as Russia and China, Oxford said in a research note on Monday.

It opined that Maduro (pictured) had a 60% chance of prevailing for at least another two years amid "an accelerated economic collapse following the US imposition of tighter economic sanctions".

Measures under consideration by Washington include a freeze of Venezuela's state assets in US jurisdictions, including oil and gas facilities. Such a move would cause crude oil production to fall by 500,000b/d, or 44%, Oxford said.

Oil output, which accounts for 95% of Venezuela's export earnings, has already plummeted by around 1Mb in the past two years. The decline has coincided with hyperinflation, severe production shortages and mass exodus of citizens to neighboring countries.

"Venezuela has not prepared for oil sanctions. On the contrary, the country is now more dependent on the US than a year and a half ago, when the threat of oil-sector sanctions became apparent," Oxford said. "Without adequate compensatory measures like an oil for food programme and extensive humanitarian aid, an asset freeze would imply a loss of 50% of Venezuela's export revenues and an even sharper contraction of imports."

Even if the US does not freeze Venezuelan assets, the country will be unable to service its debts amid dwindling oil revenues and an inability to withdraw gold reserves deposited in foreign central banks, according to the research note.

Oxford estimated there was a 30% probability that Maduro would be forcibly removed by the Venezuelan military or a US-led operation. Meanwhile, there was a 10% chance that successive coup attempts failed to oust Maduro, stymied by the involvement of Russia and militias, the UK-based consultancy said.

Venezuela's political crisis escalated last week when opposition leader Juan Guaidó declared himself president and called on the armed forces to break ranks with the government.

The US and several regional allies immediately backed the pronouncement while several European countries said they would also recognize Guaidó as the country's interim leader if fresh elections were not called within a week.