Oil producer Chevron is in talks with the U.S. government to expand a key license to operate in Venezuela so it can increase crude exports to its own refineries and sell to other buyers, four sources close to the negotiations said on Wednesday.
The talks come as Washington and Caracas progress in negotiations to supply up to 50 million barrels of Venezuelan oil to the United States and President Donald Trump presses American oil companies to invest in the South American country’s energy sector.
U.S. officials have said this week that proceeds from the Venezuelan oil supply, which is expected to help state energy company PDVSA drain inventories amid a severe oil blockade, will go to a U.S.-overseen trustee. Proceeds are meant to finance supplies of American goods to Venezuela. Chevron is the only U.S. oil major operating in Venezuela, which it does under an authorization from the U.S. government that exempts it from sanctions on the country.
As part of its sanction-hardening campaign to weaken Venezuelan President Nicolas Maduro, the Trump administration in July put additional restrictions on Chevron’s license. Those restrictions reduced the volume of Venezuelan crude the company is exporting to the U.S. to some 100,000 barrels per day (bpd) in December from 250,000 bpd earlier this year.
The restrictions also deprived PDVSA of any proceeds from Chevron’s exports.
The license expansion would allow Chevron to go back to previous export levels while providing Venezuelan crude to business partners that could allocate the cargoes in destinations other than the U.S., as the company used to do in the past.
Some of those former business partners, including an Indian refiner, were this week making inquiries in Caracas about the possible resumption of oil loadings in Venezuela, two of the sources said.
Washington is also pushing to have other U.S. companies involved in oil exports from Venezuela, including refiner Valero Energy (VLO.N), which was a customer of state company PDVSA before sanctions, and majors Exxon Mobil and ConocoPhillips, whose Venezuelan assets were expropriated two decades ago, three separate industry sources said.
The possible participation of some of those companies has brought tension to the Caracas-Washington talks, three of the sources said.
Chevron, Valero, Exxon and Conoco and the U.S. Treasury Department did not immediately reply to requests for comment.
Calling it a licence is quite remarkable.
Translated to: We want to piggyback on your invasion to plunder the Venezuelans outside of any inconvenient environmental or public safety regulations, because we agree that these are not people and this is not a sovereign nation.