US says it has returned to Venezuela all $500 million of initial oil sale

The United States has now returned to the Venezuelan government all $500 million from the initial sale of oil that was part of a deal reached between Caracas and Washington last month, a US official said on Tuesday.

The last $200 million from the sale has been sent to Venezuela, the official said, speaking on condition of anonymity. The deal came about after Venezuelan President Nicolas Maduro was captured in a US military operation on 3 January.

"Venezuela has officially received all $500 million from the first Venezuelan oil sale," the official said.

The official added that the money is to be "disbursed for the benefit of the Venezuelan people at the discretion of the US government."

Last week, during testimony on Capitol Hill, Secretary of State Marco Rubio said US involvement in the sale of Venezuelan oil was a short-term effort aimed at stabilising the country, keeping the government afloat and helping the people.

"So in essence, we allowed Venezuela to use their own oil to generate revenue to pay teachers and firefighters and police officers and keep the function of government operating so we didn't have systemic collapse," he said.

The funds had been held in Qatar and intended as a "temporary, short-term account to ensure Venezuela received the funds needed to operate," the US official said.

The official added that the long-term goal for future sales is to move the proceeds "into a fund located in the US and to authorise expenditures for any obligation or expense of the government of Venezuela or its agencies and instrumentalities upon instructions that are consistent with agreed-upon procedures."

This comes as thousands of Maduro supporters marched in Caracas on Tuesday to demand his freedom.

"Venezuela needs Nicolas," chanted the crowd, a month to the day since he was spectacularly toppled and whisked away to stand trial on drug charges in New York.

Several demonstrators, many of them public sector workers, held photos of Maduro and of his wife, Cilia Flores, who was also seized in the US raid.

The march, called by the government, stretched for several hundred meters, accompanied by trucks blaring music.

"These people are not American," said Maduro's son, Nicolas "Nicolasito" Maduro Guerra, a deputy in Venezuela's National Assembly.

"We have achieved a profound anti-imperialist consciousness."

Many protesters waved Venezuelan flags and were dressed in the red colours of the ruling "Chavista" movement named after Maduro's socialist predecessor, Hugo Chavez.

"We feel confused, sad, angry. There are a lot of emotions," said Jose Perdomo, a 58-year-old municipal employee who also declared his backing "for the decisions taken by our interim president, Delcy Rodriguez."

He added that "sooner or later they will have to free our president."