Chevron may negotiate a new crude oil export agreement with Venezuela’s state-owned PDVSA, allowing exports to destinations other than the United States, Reuters reported on Thursday.
This comes after Chevron’s license to operate in Venezuela was canceled.
Lack of progress
He declared on Wednesday that the US is revoking a license that had been previously granted, citing a lack of progress on key issues within the country.
Trump specifically accused Venezuelan President Nicolas Maduro of failing to implement necessary electoral reforms and neglecting to facilitate the return of Venezuelan migrants.
This decision reflects a hardening stance by the US towards the Maduro regime and signals an escalation of pressure on the Venezuelan government to address these critical concerns.
The move is likely to further strain relations between the two countries and could have significant implications for the ongoing political and humanitarian crisis in Venezuela.
US Secretary of State Marco Rubio had later announced on X that he would issue foreign policy guidance to revoke all oil and gas licenses of companies operating in Venezuela that “have shamefully bankrolled the illegitimate Maduro regime.”
Specific authorisations
Several energy companies have been granted access to Venezuelan crude oil under specific authorisations from the United States government.
These companies include Repsol, a Spanish multinational oil and gas company; Eni, an Italian multinational oil and gas company; and Maurel & Prom, a French oil and gas company with a focus on Africa.
These authorisations allow the companies to engage in limited oil trade with Venezuela, which has been under US sanctions.
As of Thursday morning, the US Treasury Department had not yet released any terms for license cancellation or set a deadline for winding down oil exports from Venezuela.
These exports had resumed sales to the United States in early 2023 after a 4-year hiatus.
Vessel monitoring data and PDVSA’s internal export records show that oil cargoes chartered by Chevron are leaving Venezuelan ports for the United States as scheduled, according to the report.
Maritime sources quoted in the report said shippers had not been instructed to slow down loading or divert tankers.
Chevron stated that it was evaluating the implications of Trump’s decision.
License renewed without disruptions
Chevron’s license to operate in Venezuela has been continuously renewed without any disruption since November 2022, ensuring the company’s ongoing presence in the country’s oil industry.
This uninterrupted renewal highlights the significance of Chevron’s operations in Venezuela, particularly given the company’s joint ventures’ substantial contribution to the nation’s oil production.
In the previous year, these joint ventures played a crucial role in Venezuela’s oil sector, accounting for approximately 25% of the country’s total oil output.
Consequently, this significant production level propelled Venezuela into the position of the fourth-largest crude oil supplier to the United States.
This underscores the importance of the Venezuelan oil industry to the US market and the vital role Chevron plays within it.
Meanwhile, US Gulf Coast refiners sought alternatives including Colombian, Ecuadorean and Guyanese grades on Wednesday, causing spot prices for a key medium crude grade to spike.
US Gulf Coast refineries imported 13% of their crude from Venezuela last year, according to data from the US Energy Information Administration.
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