As Oilprice.com reported on Thursday, the Trump administration is preparing to grant limited new authorizations to oil companies operating in Venezuela, starting with Chevron. This development marks a significant shift from the “maximum pressure” campaign that had all but paralyzed the sanctioned nation’s energy sector. The move follows months of lobbying, geopolitical developments, and a recent high-stakes prisoner exchange that helped to thaw tensions between Washington and Caracas.
According to multiple sources familiar with the discussions, the U.S. government is expected to authorize Chevron to restart its upstream operations in Venezuela and engage in oil swaps, under strict conditions designed to prevent direct financial benefit to the government of President Nicolás Maduro. The license would permit Chevron to pay contractors, import necessary equipment, and potentially swap Venezuelan crude for refined products, echoing previous exceptions granted under the Biden administration.
“There are already working groups so that Chevron can re-incorporate its functions,” Maduro revealed in a televised interview with Telesur, claiming that the company had already been informed of license terms allowing continued activity in the country.
Chevron, which previously produced up to 240,000 barrels per day through its joint ventures with Venezuela’s PDVSA, welcomed the decision but remained cautious. “Chevron conducts its business globally in compliance with laws and regulations applicable to its business, as well as the sanctions frameworks provided for by the U.S. government, including in Venezuela,” the company said in a statement.
The company’s shares climbed to $155.93 on Thursday—their highest since early April—on the news.
The Trump administration’s decision marks a sharp pivot from its earlier hardline stance. In February, it revoked licenses, including Chevron’s, and warned buyers of Venezuelan crude—especially in China—of impending secondary sanctions. However, enforcement of those penalties never materialized, and Venezuela’s oil output remained steady as crude was rerouted to Asia.
The change comes just days after a prisoner swap between Washington and Caracas that saw the release of 10 Americans detained in Venezuela and the repatriation of over 200 Venezuelans from El Salvador. Though the State Department insisted oil licenses were not part of the exchange, analysts remain skeptical.
“It was probably naive to believe that Maduro would release US hostages without Chevron getting a license to restart operations in return,” said Michael Shifter, senior fellow at the Inter-American Dialogue.
The change in policy also raises questions about potential divisions within the Trump administration. Secretary of State Marco Rubio has traditionally led the hawkish faction, skeptical of any concessions to Maduro, while special envoy Richard Grenell has favored pragmatic engagement, particularly on issues like migration and energy security.
Unlike previous arrangements, the new license will reportedly last for six months and will not renew automatically. Payments to the Venezuelan government will be structured to avoid direct cash transfers, potentially using oil as payment for royalties and taxes. This approach attempts to minimize the financial lifeline to Maduro’s government, though critics argue that PDVSA’s role in granting export permits and collecting taxes inherently funnels resources to the state.
A senior State Department official stated that the U.S. would not allow the Maduro government to profit from the oil, but past licenses inadvertently supported Caracas via royalty structures and import cost savings.
It’s unclear whether similar authorizations will be extended to European firms like Italy’s Eni or Spain’s Repsol, which have lobbied for the ability to swap fuel for Venezuelan crude.
Chevron’s return is widely seen as a strategic win for the company and its argument that a vacuum in Venezuela’s oil sector would only be filled by China and Russia. The policy shift may prevent a further erosion of U.S. influence in Latin America’s energy landscape, but it comes at the cost of further muddying Washington’s approach to democracy and human rights.
For oil markets, the potential of new supply from Venezuela will weigh on both WTI and Brent, but optimism surrounding a potential trade deal between the EU and the U.S. pushed prices higher in early Asian trading.
By Charles Kennedy for Oilprice.com
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