U.S. says it will exert economic muscle to support Venezuela's Guaido

Venezuela's opposition leader Juan Guaido gestures as he arrives for a news conference in Caracas, Venezuela January 25, 2019. REUTERS/Carlos Barria

WASHINGTON (Reuters) - The U.S. Treasury on Friday signaled it was working to tighten the financial noose on Venezuelan President Nicolas Maduro as it steps up efforts to transfer control of government assets to opposition leader Juan Guaido.

The Treasury Department statement stopped short of announcing a freeze on Venezuela’s U.S. assets and accounts, however.

On Wednesday, Washington recognized National Assembly chief Guaido as Venezuela’s interim president.

“The United States 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 this recognition,” the U.S. Treasury said in a statement.

The announcement came as Washington intensified its push to drive socialist Maduro from power. Maduro began a second term earlier this month after winning disputed elections last year, and is still supported by the Venezuelan military.

Maduro said earlier he would defend Citgo, the U.S. refining subsidiary of Venezuelan state oil company PDVSA, amid moves by Guaido to divert its revenues, sources close to the talks told Reuters.

Reporting by Lesley Wroughton, Editing by Rosalba O’Brien