The US has granted Chevron limited permission to resume pumping oil from Venezuela after announcing on Saturday that the Venezuelan government and the opposition group have reached an agreement on humanitarian aid and will continue to negotiate a solution to the country’s chronic economic and political crisis. the country, including a focus on the 2024 elections.
A senior Biden administration official described Saturday’s announcements as “significant steps in the right direction,” but noted that much remains to be done as both sides work toward a more permanent solution to the ongoing crisis. The official also highlighted the limited nature of the license, saying they do not expect it to have a tangible impact on international oil prices and that the move is intended as a boost to negotiations – not as a response to high global oil prices .
The Treasury Department’s Office of Foreign Assets Control on Saturday issued Venezuela General License 41, which authorizes Chevron to “resume limited extraction of natural resources in Venezuela,” according to a Treasury Department press release. This is a 6 month license and the US can revoke it at any time. In addition, any profits earned will be spent on repaying debts owed to Chevron and not the Maduro regime, the senior official said, stating that the US government will continue to require Chevron to provide significant reporting on its financial operations.
“GL 41 only authorizes activities related to Chevron’s joint ventures in Venezuela, and does not authorize any other activities with PdVSA. Other Venezuela-related sanctions and restrictions imposed by the United States remain in effect; the United States will vigorously enforce these sanctions and continue to hold accountable any actor who engages in corruption, violates US laws or violates human rights in Venezuela,” the release said. PdVSA is the state-owned Venezuelan oil and gas company.
Chevron CEO Mike Wirth told Bloomberg TV earlier this year that if a thaw were to come, it would take months and years to refurbish their oil fields in the country and there would be “not immediate” impact on oil production .
If the Venezuelan regime continues to take concrete steps to reach a negotiated solution, targeted relief of sanctions will be possible in the future, according to the official.