Trump administration allows Chevron to restart Venezuela operations

The Trump administration is reversing its stance on Chevron’s licence to produce oil in Venezuela, in a significant softening of policy towards the authoritarian socialist government of President Nicolás Maduro, Report informs via The Financial Times.

Two people with knowledge of the agreement said Chevron was being given permission to resume pumping and exporting oil from the South American nation, just five months after the Trump administration announced it would cancel the group’s license over concerns about human rights.

Chevron had been granted a licence to produce and export Venezuelan crude by the Biden administration, a move heavily criticised by the country’s embattled democratic opposition and by President Donald Trump, who declared on Truth Social: “We are hereby reversing the concessions that Crooked Joe Biden gave to Nicolás Maduro, of Venezuela.”

The policy reversal is a big win for Chevron, which has lobbied hard to have its licence restored, arguing China and Russia would gain influence in the oil-producing nation — and the western hemisphere — if it was forced out.

It also underlines the chaotic and transactional nature of the Trump administration’s foreign policy dealings, in which human rights and other issues can become bargaining chips in larger negotiations over other issues.

The move reflects differing positions within the Trump administration on Venezuela policy, with hawks led by secretary of state Marco Rubio often at odds with Richard Grenell, the president’s envoy for special missions, who has favoured cutting deals with Caracas on migration and energy.

The new arrangement was similar to the Biden licence except that it would initially last for only six months, without automatic renewal, according to one person with knowledge of the discussions, and the Venezuelan government would receive payment for royalties and taxes in oil, not cash.

Other foreign oil companies have had their Venezuela licences cancelled by the Trump administration. It was not immediately clear whether these would be restored as well.

A senior state department official said: “While we cannot speak to any specific licences, the US government will not allow the Maduro regime to profit from the sale of oil.”

The agreement follows a prisoner swap completed between Washington and Caracas last week that saw the release of 10 US citizens imprisoned in Venezuela, while 250 Venezuelans deported by the US to El Salvador were returned home. Maduro has long used detained US citizens as a bargaining chip in negotiations with Washington.

The state department official said the licenses were not a consideration in the prisoner exchange.

Until the Chevron reversal, Trump had largely continued the “maximum pressure” approach of his first term towards Maduro, who was sworn in for a third term in January despite widespread evidence of fraud in last year’s election. Following that vote, Maduro launched a crackdown on dissent, arresting hundreds.

Analysts said the passage of Trump’s landmark tax legislation, which relied on votes from Congressional Republicans pushing a hardline stance against Venezuela, gave the administration an opening to relax the sanctions now that it has been adopted.

“Venezuela sanctions may have been the price of three Florida votes back in May, but Trump’s big beautiful bill became the law of the land on July 4,” said Kevin Book, managing director of ClearView Energy Partners.

Michael Shifter, senior fellow and former president of the Inter-American Dialogue think-tank in Washington, said “it was probably naive to believe that Maduro would release US hostages without Chevron getting a licence to restart operations in return. This marks the latest flip-flop in the Trump administration’s energy and Venezuela policy.”

Chevron, which operates through joint ventures with Venezuela’s state oil major PDVSA, produced about 240,000 barrels a day of crude before it was ordered to cease production, which is about a quarter of the nation’s oil output.

Chevron said in a statement that it conducted its business globally in compliance with laws and regulations applicable to its business, as well as the sanctions frameworks provided for by the US government, including in Venezuela.