Trump cancels Venezuela's oil export licenses to the United States

In the most humiliating way, in a confusing message on his social networks, Donald Trump announced this Wednesday the cancellation of Venezuela's oil export licenses that his predecessor, Joe Biden, had authorized two and a half years ago. The US president justifies his move by the irregularities in the last Venezuelan elections and the alleged slowness of Caracas to comply with the commitments agreed with the Republican Administration on repatriation flights for illegal immigrants.

“We hereby reverse the concessions” given in “the oil transaction agreement dated November 26, 2022,” the Republican said in his message. On the day mentioned, the Biden administration had authorized the American oil company Chevron to expand its production in Venezuela and introduce crude oil from that country into the US market. No other American company has such permits. The cancellation will take effect as of March 1, Trump said.

Chevron has been able to continue its operations in Venezuela , the country with the largest proven reserves in the world, under the contracts it signed in 2019, despite the sanctions that successive US administrations have imposed against Nicolás Maduro's regime following electoral fraud perpetrated in the 2018 and 2024 presidential elections. Last month, about 238,000 barrels of Venezuelan oil arrived in the United States via Chevron, according to Reuters.

Trump had already announced ten days ago that he was considering cancelling the export licence, which the Democratic administration had authorised as a reward for the dialogue initiated at that time between the government of Nicolás Maduro and the opposition and which Washington hoped would lead to the holding of fair elections on 28 July.

Governments of several countries, including the United States, and organizations specializing in electoral observation, including the Carter Center, have determined that these elections were not conducted impartially. Washington, the European Union and other nations consider the opposition candidate Edmundo González Urrutia the winner. The electoral commission in Caracas declared Maduro's victory, although it has never published the official minutes of the process. The opposition has done so, in sufficient numbers to demonstrate the victory of its candidate.

In his message, Trump claims that the oil agreement “had to do with electoral conditions in Venezuela, which the Maduro regime has not fulfilled.” He also claims that Caracas has not fulfilled “with the agreed speed” the promise it made to the Trump Administration to repatriate irregular Venezuelan immigrants from the United States. The Chavista regime did not accept the expelled irregular Venezuelan immigrants until late last month, when the American envoy Richard Grenell traveled to the Andean country and obtained Maduro’s “yes” to a priority initiative for the new Republican Administration.

“I hereby order that the ineffective and unfulfilled Biden agreement be terminated on March 1,” reads the message on Truth, the social network owned by the American president.

Speaking to reporters at his private residence in Florida, Mar-a-Lago, the Republican had said that “probably not.”

would allow Caracas to sell its oil abroad . “We are looking at it now... we are looking at the whole situation,” he said.

Secretary of State Marco Rubio, who was a proponent of a heavy-handed approach towards Caracas during his time in the Senate, had questioned the license for Chevron because it is an important source of income for the Maduro regime.

Most of the experts consulted have preferred to remain cautious in the face of the announcement. Some are waiting for subsequent scenarios of political negotiation. Trump's surprising statements on his social networks have generated enormous surprise, and constitute an undesired, even feared, scenario, both in Chavismo and in a part of the opposition.

Without the contribution of Chevron and other companies that have obtained special licenses to operate Venezuela's oil fields, such as Eni and Repsol, the national coffers would experience a huge decline, which would have immediate consequences on the availability of foreign currency, exchange rate stability, price growth, and, probably, a new fall in the country's economic activity, after the precarious figures of recovery of the last four years. The socioeconomic catastrophe of the 2014-2020 period has expelled millions of people from the country in a context of productive collapse.

Until now, the impression seemed well-founded among economists and politicians that the visit of Richard Grenell as a special envoy from the White House to talk with Nicolás Maduro in Caracas would consolidate the migratory flow of illegal Venezuelan emigrants back in exchange for a margin of certainty regarding the presence of Chevron in the country, something that the Chavista regime considers fundamental, although it does not say so publicly.

Chevron also wants to continue operating in Venezuela, and has made a huge effort to consolidate its presence in order to collect old debts and increase its production. Earlier this month, the CEO of the Texas company, Michael Wirth, warned in a talk at the Atlantic Council think tank that “if we were to leave, there is no doubt that the operations in which we are currently involved would end up the same way,” Wirth said.

Venezuelan oil production, which historically, in the times of representative democracy, averaged some 3.2 million barrels per day, all under the responsibility of Petróleos de Venezuela, is now slowly approaching one million barrels per day, after a stormy period of managerial anarchy and corruption, to which were added the difficulties of international sanctions. Of these, just over half correspond to PDVSA's own efforts.