WASHINGTON, D.C. – The Trump administration announced on Tuesday the termination of a license that had allowed oil producer Chevron to operate in Venezuela and export its oil to the United States. The decision comes after Washington accused Venezuelan President Nicolás Maduro of failing to make progress on electoral reforms and the return of migrants.
Since 2019, the U.S. has imposed strict sanctions on Venezuela’s energy sector, with some companies receiving exemptions to maintain operations and supply crude oil to markets including the U.S., Europe, and India. The license granted to Chevron in November 2022 was a major step in easing sanctions and allowed the resumption of Venezuelan oil exports to the U.S.
However, with President Donald Trump returning to office in January, his administration has sought to reduce U.S. reliance on Venezuelan crude. Venezuelan oil accounted for 3.5% of total U.S. crude imports in 2023, or approximately 220,000 barrels per day (bpd). While the decision aligns with Trump’s stance on energy independence, it could have significant financial implications for Chevron, which has used Venezuelan oil sales as a key mechanism to recover billions of dollars in unpaid debt from the country.
According to an update from the U.S. Treasury Department, Chevron has been given until April 3 to wind down exports and other operations in Venezuela. The scale of this reduction remains uncertain. A Chevron spokesperson confirmed that the company is aware of the directive and will comply with Treasury’s guidance.
This move echoes a 2020 order by Trump’s previous administration, which allowed Chevron to continue producing crude in Venezuela but prohibited any exports or imports. That restriction led to a sharp decline in production and billions of dollars in unpaid revenue.
Following Trump’s announcement, Venezuelan Vice President Delcy Rodríguez condemned the decision, calling it “damaging and inexplicable.” Additionally, U.S. Secretary of State Marco Rubio hinted last month that further policies would be introduced regarding foreign oil companies operating in Venezuela, though details remain undisclosed.
Chevron’s joint ventures with PDVSA, Venezuela’s state-run oil company, account for about a quarter of the country’s total oil output. In January alone, Chevron exported nearly 300,000 bpd of Venezuelan crude to the U.S., supplying refineries operated by major firms such as Valero Energy, PBF Energy, Phillips 66, and Exxon Mobil.
The termination of Chevron’s license is expected to create economic and geopolitical ripple effects. It marks a shift in U.S. policy toward increased pressure on Maduro’s government, particularly following the contested 2024 presidential election, which was endorsed by Venezuela’s electoral authority and Supreme Court but widely rejected by the opposition and the U.S.
With no alternative measures yet announced for foreign oil companies operating in Venezuela, the impact on global oil markets and Venezuela’s fragile economy remains uncertain.
