U.S. prepares to sanction Venezuela officials, Maduro defies threat

By Matt Spetalnick and Andrew Cawthorne

WASHINGTON/CARACAS (Reuters) - The Trump administration is preparing sanctions against several senior Venezuelan officials, U.S. officials said on Tuesday, to pressure President Nicolas Maduro to abort plans for a controversial congress foes say would cement dictatorship.
Maduro's leftist government vowed to proceed with the July 30 vote for the new Constituent Assembly despite what it called a "brutal interventionist" threat from its ideological foe.
President Donald Trump said on Monday he would take "strong and swift economic actions" if Maduro went ahead with the new body that would have power to rewrite Venezuela's constitution and supersede other institutions.
Trump's administration is crafting possible sanctions against Defense Minister Vladimir Padrino Lopez and Socialist Party No. 2 Diosdado Cabello for alleged rights violations, U.S. officials said, speaking on condition of anonymity.
A senior Trump administration official made no announcement of new sanctions on a conference call with reporters on Tuesday and said the policy review was still under way.
That official stressed "all options are on the table," including possible measures against Venezuela's vital oil sector, as Washington seeks to head off the July 30 vote, which it sees as Maduro's effort to create a "full dictatorship."
The possible sanctions on officials, which would follow similar steps against Venezuela's vice president earlier this year, would freeze their U.S. assets and prohibit anyone in the United States from doing business with them.
A sanctions announcement could be made within days unless Trump decides to put the move on hold, something one of the sources told Reuters could not be ruled out.
The senior administration official declined to provide the names of individuals or entities that could be on any forthcoming list, but said the United States "reserved the right" to issue sanctions even before the July 30 vote.
While tough oil-related sanctions could bankrupt the Maduro administration and worsen grave food shortages, hitting Venezuela's energy sector could raise U.S. domestic gasoline prices, which would be unpopular with Americans.
Venezuela is the third largest foreign oil supplier to the United States, after Canada and Saudi Arabia, exporting about 780,000 barrels per day of crude.
Any sanctions by Trump, who is largely unpopular abroad, could be used by Maduro to bolster his accusations that Washington is trying to sabotage leftism in Latin America and unite the ruling Socialist Party just as fissures were emerging.

'XENOPHOBIC THREAT'
Decrying "imperialism" still resonates for some in a region scarred by Washington's support of coups during the Cold War.
"Venezuelans are free and will unite against the insolent threat from a xenophobic and racist government ... (and) the United States' brutal interventionist efforts," Foreign Minister Samuel Moncada said, vowing the July 30 vote would go ahead.
"It is an act of political sovereignty by the Republic. Nothing and nobody can stop it," he said.
Polls show a majority of Venezuelans oppose the Constituent Assembly, which critics say would be elected in a sham poll.
Maduro insists it is the only way to bring peace after months of anti-government unrest that has killed 100 people and further hurt a crippled economy.
Maduro's opponents say they drew 7.5 million people onto the streets at the weekend to vote in a symbolic referendum where 98 percent disagreed with the assembly.
Calls to cancel the assembly and instead hold conventional elections have come from around the world, including the European Union and major Latin American nations.
The ruling Socialist Party would likely be thrashed in any normal vohe due to widespread anger over economic hardships.
"The Constituent Assembly should be abandoned ... The whole world is asking for that," Colombia's President Juan Manuel Santos tweeted.

(Additional reporting by Diego Ore, Andreina Aponte, Alexandra Ulmer and Girish Gupta in Caracas, Marianna Parraga in Houston, John Walcott and Ayesha Rascoe in Washington; Writing by Andrew Cawthorne and Alexandra Ulmer; Editing by David Gregorio and Andrew Hay)

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