MIAMI — American Airlines will become the latest airline to drastically reduce service to Venezuela in light of an ongoing dispute between international carriers and the Venezuelan government over strict currency controls. The rules currently prevent airlines from repatriating earnings from tickets and cargo space sold in the country without government approval.

American will reduce weekly service to Venezuela from 48 to 10 flights per week by dropping service between Venezuela’s capital Caracas and New York JFK International Airport, Dallas-Fort Worth, and San Juan starting July 2. The reductions amount to an 80 percent cut in service.

As of March 31, American had $750 million USD trapped in Venezuela.  American joins eleven other airlines that have cut capacity, sales, or routes to Venezuela as a result of the country’s economic crisis, which has caused the revenue of international airlines to be reduced by the country’s inflation rate, currently the fastest in the world at almost 60 percent, and frequent devaluations of its currency, the bolivar.  Air Canada and Alitalia are the only airlines to have suspended all their service to Venezuela so far.

After the cuts, American will only serve Venezuela from Miami.  Flights to Caracas will be reduced from four daily to one, with an added flight on Saturdays.  Miami to Maracaibo service will be changed from daily to twice per week.  The only other U.S. carriers serving Venezuela are Delta from Atlanta and United from Houston, both with one flight per day.

In May, Venezuela reached agreements with Aeromexico, Aruba Airlines, Avianca, Insel Air, and TAME to repatriate debt from 2012 and 2013 in-country sales, which will be paid in installments through 2016.  The Venezuelan government said foreign airlines that suspended flights to the country would not be welcomed back and suggested it may devalue the bolivar for ticket purchasers as it worked to normalize flights and prevent the other airlines from leaving the country.  Venezuela owes foreign carriers $4 billion USD.