Updates with reaction from Chevron, other details.
US president Donald Trump said today he will revoke a 2022 Venezuela sanctions waiver, most likely referring to Chevron's authorization to lift crude cargoes from its joint venture with Venezuelan state-owned PdV.
Trump did not explicitly reference Chevron, but his description of the waiver from Venezuela sanctions he said he was revoking matches the US major's authorization date and terms.
The Chevron authorization would not be renewed on 1 March, Trump said.
"We are aware of today's announcement and are considering its implications," Chevron said, adding that it "conducts its business in Venezuela in compliance with all laws and regulations, including the sanctions framework provided by US government."
The 26 November 2022 authorization for Chevron was auto-renewed every month and allowed the company to operate in Venezuela for a six-month period after each renewal. Since Trump noted that he would not renew the license on 1 March, the terms of that license in theory allow Chevron to continue operations in Venezuela until 1 August.
Chevron expects the six-month wind-down period to remain in place, a source close to the company's Venezuela operations said.
The US Treasury Department has yet to confirm details of the new Venezuela sanctions regime as described by Trump.
Former president Joe Biden's administration allowed Chevron to resume cargo loadings from Venezuela, only for imports into the US, in October 2022, as part of a deal with Venezuelan president Nicolas Maduro's government to encourage holding free elections.
The US imported 222,000 b/d of crude from Venezuela in January-November 2024, US Energy Information Administration data show.
While insignificant for total US crude imports, Venezuela cargoes amounted to about 10pc of Chevron's global liquids output as of last year.
Chevron's Venezuela presence did not result in major financial gains for Caracas. But it allowed PdV to stabilize and then grow Venezuela's crude output.
Venezuela's crude production, including liquids and condensates, held at about 1.04mn b/d in January, according to PdV.
Chevron was among a handful of western companies allowed to draw crude cargoes from Venezuela, but on terms that precluded direct cash payments to PdV.
Independent refiners in China are the primary customers for Venezuelan Merey crude, imported through a network of ships, agents and brokers established to circumvent US sanctions. The scheme resulted in significant discounts for Chinese buyers of Merey, which traded at discounts ranging from $6.50-7/bl against May Ice Brent, for March arrival.
Migration pipeline
The Trump administration appeared willing to retain the Chevron authorization as long as the Maduro government cooperated on accepting Venezuelan nationals deported from the US. Trump's envoy Ric Grenell traveled to Caracas last month to discuss cooperation on migrants, and he suggested over the weekend that the US was no longer interested in a change of Venezuela's government.
But Trump said today that the Maduro government "has not been transporting the violent criminals that they sent into our Country (the Good Ole' U.S.A.) back to Venezuela at the rapid pace that they had agreed to."
Trump's Republican allies in Congress hailed his decision, describing the Chevron authorization as a "Biden oil deal".
The Republicans hold a narrow 218:215 majority in the US House of Representatives, with two vacant seats in Florida that in November elected Republican lawmakers who since resigned. US relations with Venezuela are a key political issue in Florida, which is home to many Americans of Cuban and Venezuelan descent.
Caracas blasted Trump's decision, with Venezuela's vice-president Delcy Rodriguez saying in a social media post that "these kinds of failed decisions prompted the migration from 2017 to 2021 with the widely known consequences."
PdV and Venezuela's oil ministry declined to comment.
