Maduro In US Custody: What's Next for Venezuela?

Summary

Bloomberg's Erik Schatzker discusses the capture of Nicolás Maduro and what comes next for Venezuela. He recounts Maduro's 2021 interview and says Maduro lacked goodwill and leverage, leaving him with few options. Schatzker outlines deep uncertainty over Venezuela's transition, including military loyalty and opposition leader María Corina Machado's prospects. He highlights the market implications for defaulted Venezuelan sovereign debt and PDVSA debt, which could rally on a stable transition but otherwise face unpredictable outcomes.

• Nicolás Maduro and his wife are in US custody and face criminal charges in New York.
• Erik Schatzker spoke with Maduro in 2021 and says Maduro missed chances to negotiate.
• Schatzker says the 2024 Venezuelan election was not credible and Maduro remained defiant.
• Key uncertainty is whether Venezuela's military and government figures will support an orderly transition.
• Maria Corina Machado and the opposition would like to take power, but military support is critical.
• Roughly $30 billion each of Venezuelan sovereign debt and PDVSA debt trade around 25-30 cents on the dollar.
• A stable new regime that honors defaulted debt could spark a stronger rally; no stable transition leaves debt outcomes unclear.