Foreign Authorities in Venezuela Seek Investment From Abroad Before Oil-Related Penalties Enforcement

Headline: Maduro's Oil Pitch Amidst Chevron's Exit and Tightening Sanctions

March 13, 2025 - Our Newsroom

In the face of impending oil industry woes due to escalating US sanctions, Venezuelan president Nicolás Maduro is courting global partners to invest in oil, natural gas, petrochemicals, and refining.

During a TV meeting with top officials, Maduro declared, "We're open to all foreign investments in oil, gas, petrochemicals, and refining. Our doors are wide open for the world to walk in, produce, and make profits."

Venezuela's oil sector has faced an investment crunch due to underinvestment, poor maintenance, and a brain drain, problems further exacerbated by US economic coercion. Despite generous incentives for foreign investors, US firms, even non-American ones, have shied away due to the threat of secondary sanctions.

Maduro presented several Venezuelan projects and urged industries to focus on "production, domestic supply, and exports." Optimistically, he said, "We have everything we need to keep growing on our own."

The country's economic backbone is gearing up for the fallout from the Donald Trump administration's decision to force Chevron to halt operations by May 27. The US Treasury Department issued General License 41A on March 4, giving Chevron 30 days to wrap up its Venezuela affairs.

The Biden administration's only major deviation from the "maximum pressure" campaign's financial sanctions, export embargo, secondary sanctions, and other measures against the Venezuelan oil industry is now a thing of the past. European firms such as Maurel & Prom (France), Repsol (Spain), and Eni (Italy) are also likely to receive short deadlines to abandon their energy projects in Venezuela, having boosted their presence with Washington's approval in recent years.

Contrasting with earlier engagement efforts with the Maduro government, the Trump White House's sanctions escalation includes the imminent resumption of Venezuelan migrant deportations, according to Special Envoy Richard Grenell. The Caracas administration had earlier announced a temporary halt in cooperation with the US concerning repatriation flights.

Impact on Production

Chevron CEO Mike Wirth demanded a more "steady and consistent" U.S. policy on foreign oil operations that doesn't "swing from one extreme to the other." Despite this, he reaffirmed that the company would comply with the U.S. Treasury's directives regarding Venezuela.

Chevron's contractors in Venezuela have kept working despite the deadlines, potentially signaling the corporation's confidence in securing an extension or new license. The Texas-based firm currently holds minority stakes in four joint projects with the Venezuelan state oil company PDVSA, which collectively produce over 200,000 barrels per day (bpd) of crude, accounting for about a quarter of the country's total.

Chevron's departure is predicted to cause an instant blow to Venezuela's oil output, resulting in possible fuel shortages, currency supply issues, and inflation. The latest OPEC monthly report places the Caribbean nation's February output at 918,000 bpd, according to secondary sources, a slight rise from January levels. PDVSA reported a production of 1.025 million bpd for February, down from 1.031 million bpd the previous month.

Venezuela's output remains at its highest since early 2019. Exports also showed some growth, averaging 934,000 bpd in February, as per Reuters. China remains the top market for Venezuelan crude.

Edited by José Luis Granados Ceja in Mexico City, Mexico.

Insights from Enrichment Data:

The suspension or removal of major foreign corporations from Venezuela's oil industry will significantly decrease Venezuelan oil output and exports, further straining the already unstable economy.
The U.S. tariff on imported Venezuelan oil is likely to deter potential buyers, exacerbating Venezuela's financial difficulties.
The broader sanctions strategy adopted by the Trump administration is part of an effort to apply pressure on the Maduro regime, potentially leading to increased economic instability in Venezuela.

The Biden administration's continuation of the "maximum pressure" campaign's financial sanctions and export embargo against Venezuela's oil industry, despite a minor deviation by the previous administration, could lead to a decline in Venezuela's oil production, as seen with Chevron's planned exit.
In an attempt to fill the void left by Chevron and other international firms, Venezuelan president Nicolás Maduro is actively seeking foreign investments in oil, gas, petrochemicals, and refining, as declared during a TV meeting with top officials.
The departure of companies like Chevron could have far-reaching consequences for Venezuela's economy, potentially leading to fuel shortages, currency supply issues, and inflation, especially since Chevron's projects collectively produce over 200,000 barrels per day of crude, constituting about a quarter of the country's total output.