Putin wins, the longer Venezuela's Maduro hangs on

A week after opposition leader Juan Guaido proclaimed himself Venezuela's new president, his rival, Nicolas Maduro, remains in control of most of the levers of power, setting the stage for what could turn out to be a long standoff.

Kremlin watchers in Moscow say that would likely suit Russian President Vladimir Putin just fine.

"This could drag on for months," said Vladimir Frolov, an independent Russian foreign policy analyst. "If Maduro stays for a protracted period of time and the U.S. does nothing, Maduro and Russia win."

Russia and China are Maduro's major international political and financial backers. But whereas China's interests in the oil-rich South American nation are largely commercial, for Russia, the Kremlin's prestige is on the line.

Russia has a long history of supporting the anti-American regimes of Maduro and his predecessor, Hugo Chavez, as a means of extending Russian influence into the Western Hemisphere.

In recent years, as Venezuela's financial crisis intensified, Russia doubled down on that support, spotting Maduro billions of dollars in exchange for purchasing Russian weapons and getting access to Venezuelan oil projects years down the line.

Frolov said the U.S. has gone all-in on having Maduro ousted. But the longer Maduro maintains control — thanks to the backing of Venezuela's so-far loyal military — the harder it becomes for U.S. President Donald Trump to claim a political victory.

"Right now, the United States does not seem to have a plan B for this scenario, and Trump could suffer a humiliating defeat at the hands of Putin, increasing Putin's leverage on other issues," said Frolov.

Major Russian investment

Russia may have as much as $25 billion US tied up in Venezuela, largely in oil and gold, according to the Latin American Institute of the Russian Academy of Sciences.

By comparison, U.S. foreign direct investment in Venezuela was $6.6 billion in 2017, according to the Office of the U.S. Trade Representative, mainly in manufacturing and "information services."

Russian state oil company Rosneft may have the most at stake. Venezuela has the world's largest oil reserves, and Rosneft is involved in five joint ventures with Venezuela's state-owned corporation PDVSA. In November, Rosneft announced Venezuela still owes it $3.1 billion.   

The head of Rosneft, Igor Sechin, is one of Putin's most powerful allies, and has been the Russian face attached to most of the deals.

China has extended Venezuela an even bigger lifeline — up to $50 billion in loans-for-oil agreements over the last decade. But there were yet more signs on Thursday that China's tolerance for Venezuela's risk was running out.

Petro China announced it was dropping Venezuela's PDVSA as a partner in a planned refinery in the southern Chinese city of Jieyang. Reuters reported the Chinese company based the decision on PDVSA's deteriorating financial situation.

Limited options

Along with the U.S., Canada was one of the first nations to recognize Guaido as the rightful president of Venezuela, with most of Central and South America quickly following suit. On Thursday, the parliament of the European Union passed a resolution urging EU nations to also recognize Guaido.

Russian state media is full of stories lambasting the U.S. for attempting a "coup" or scheming to "overthrow" Maduro. Yet there is also much discussion in Russia about the country's limited options to help its ally.

It appears there is zero political appetite to turn Venezuela into another Syria.

In 2015, with forces of the Islamic State occupying most of Syria and the regime of President Bashar al-Assad poised to fall, Russia intervened decisively with air strikes and ground forces, turning the tide of the conflict.

The Kremlin has indicated, however, Russian military intervention is not being considered with Venezuela.

"I think [Putin's government] has done everything which it could" in Venezuela, said Dmitry Rozental with the Latin American Institute of the Russian Academy of Sciences. Rozental said he expects that going forward, Russian help to Venezuela will be limited to "moral support."

Rozental told CBC News that Russia's best outcome is for Maduro to somehow "ride out" the next few weeks and hope that the protests die down.

In the meantime, Rozental said the Putin administration should be looking for openings with Venezuela's opposition.

"I think we have the ability to build some constructive dialogue with the pragmatic part of the opposition," Rozental said. "Discussion between Russian diplomats and Venezuela is possible. It's important for the future of our presence in this country."

Could be 'humiliating' for Putin

On Wednesday, Russian foreign minister Sergei Lavrov offered to take part in a mediated solution to the crisis, but Guaido has rejected that, suggesting Russia simply wants to drag things out and keep Maduro in power longer.

Having his ally Maduro turfed in Venezuela would be humiliating for Putin, said Frolov, the Moscow-based analyst.

"That would put the last five years of Russian foreign policy to naught," he said.

The Putin regime also recoils at the notion of having yet another political ally potentially overthrown by street protests.     

Guaido proclaimed himself the president of Venezuela after tens of thousands of Venezuelans marched in the streets last week.

Many commentators on Russian state television said it was like another "Ukrainian Maidan," a reference to events in 2014, when violent protests in Kiev saw pro-Russian President Viktor Yanukovych forced out, and Ukrainians elected a more Western-friendly leader.  

The Russian government insists the Maidan events were precipitated by U.S. interference.

"Moscow vowed to fight U.S.-led democracy promotion and regime change … and prides itself on succeeding to reverse the colour revolutions in the Middle East through its support for Assad and other Arab strongmen," said Frolov.

"The fall of Maduro, viewed by Moscow as an unprovoked attack, would be very humiliating to Putin."

The U.S. has been unveiling an almost-daily list of economic sanctions on Maduro's regime, aimed at depriving his government of lucrative oil money and isolating it from the international economy.

Social media has gone wild over the past 48 hours with speculation that Maduro may be trying to move $840 million worth of his country's gold reserves out of Venezuela to Russia. Photos taken at the Caracas airport showed a Russian plane, which later took off and flew back to Moscow,  arriving earlier today.

Kremlin spokesman Dmitry Peskov has said he has no knowledge of plans to move any gold to Russia.