The Bank of England has blocked Nicolas Maduro's last-ditch attempt to save his regime by withdrawing $1.2 billion (Dh4.4bn) worth of gold, a significant part of the $8 billion in foreign reserves held by the Venezuelan central bank.
The bank's decision to deny the withdrawal request comes after a co-ordinated move by western governments to boost Mr Maduro's challenger, Juan Guaido, who proclaimed himself interim president on Wednesday, according to a Bloomberg report.
Speaking at the United Nations Security Council in New York on Saturday, US Secretary of State Mike Pompeo recognised Mr Guaido as the nation’s head of state and prompted other states to “pick a side”.
Speaking ahead of his meeting with Mr Pompeo and US Vice President Mike Pence, UK Foreign Secretary Jeremy Hunt said it was “clear that Nicolas Maduro is not the legitimate leader of Venezuela.”
Mr Maduro was sworn in for a second term earlier this month after an election marred by an opposition boycott and allegations of vote-rigging, leading to large street protests. Under Mr Maduro’s rule, which begun in 2013, 10 per cent of Venezuela’s population is estimated to have fled due to worsening economic conditions.
US officials are trying to redirect Venezuela’s overseas assets towards the coffers of Mr Guaido to help bolster his chances of taking control of the government. The whereabouts of the $8 billion in foreign reserves is largely unknown.
Retrieving the gold in the Bank of England has been a major priority for the Maduro regime, which sent a delegation to London in December to gain access to it, according to Bloomberg.
The talks were unsuccessful and the Central bank officials in Caracas has been ordered to no longer try contacting the Bank of England, citing compliance reasons.
The US Treasury released a statement saying that the US “will use its economic and diplomatic tools to ensure that commercial transactions by the Venezuelan Government, including those involving its state-owned enterprises and international reserves, are consistent with” its recognition of Mr Guaido as interim president of Venezuela.
Turkey recently emerged as a destination for freshly mined Venezuelan gold and the US is leading an international effort to persuade the former to stop being a conduit for these shipments as backing for Maduro.
Key allies of Venezuela’s embattled president – including Russia, China, and Iran – have warned the US not to intervene in support of the opposition leader.
Russia’s Vladimir Putin spoke by telephone with Mr Maduro to offer him strong support in a political crisis he said had been “provoked from abroad”, according to a Kremlin statement.
Mr Maduro, an authoritarian ruler who critics see as responsible for plunging the country into economic chaos, refuses to give up power as he has the backing of the military.
The European Union threatened to recognise Mr Guaidó unless a “credible” presidential election is called with eight days.
Venezuela later rejected the ultimatum at a UN meeting. "Nobody is going to give us deadlines or tell us if there are elections or not," Foreign Minister Jorge Arreaza told members of the UN Security Council.