Chevron May Get Sanctions Loophole in Venezuela

The Trump administration is reportedly considering granting limited authorizations to a handful of oil companies operating in Venezuela, with Chevron first in line. The move would mark a shift from Washington’s hardline stance earlier this year, when key licenses were revoked and U.S. firms were ordered to wind down all activity with PDVSA, Venezuela’s state oil company.

According to sources familiar with the discussions who spoke to Reuters, the new authorizations would allow Chevron and potentially some European partners like Eni and Repsol to pay contractors and import critical equipment needed to maintain operations. However, the licenses would come with tight restrictions to ensure that no revenues benefit the Maduro regime.

This cautious pivot follows a diplomatic prisoner swap between the U.S. and Venezuela earlier this month, though relations remain strained. In February, the administration canceled several energy licenses, including Chevron’s, and in May blocked efforts to extend them. Yet concerns have grown that Washington’s absence is leaving a vacuum for China to fill.

Since sanctions were reimposed, Venezuela’s oil exports have held steady—thanks largely to rising shipments to China. In May, PDVSA sent nearly 600,000 barrels per day to Chinese buyers, while authorized U.S. trade all but ceased. With Chevron sidelined, Chinese firms have moved in via opaque production-sharing deals, gaining influence without formal ownership.

Chevron, still a shareholder in several joint ventures, was granted a narrow maintenance license earlier this summer that allows it to preserve assets but not produce or ship oil. That may now be expanded—though any move must still clear Secretary of State Marco Rubio’s desk.

If approved, the licenses would offer Western companies a lifeline to maintain operational continuity in Venezuela, while giving the U.S. a modest foothold in an increasingly China-dominated oil sector. But the window is narrow, and the political cost could be steep if the move is seen as softening pressure on Maduro.

By Julianne Geiger for Oilprice.com

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