Chevron is working to protect its special license that permits it to operate in Venezuela. The company warns that if the U.S. government pushes it out, both China and Russia could gain more influence in this oil-rich country and the surrounding region.
In a recent interview, Chevron’s CEO, Mike Wirth, pointed out that the company plans to engage with the White House about the future of its operations, especially after remarks from Secretary of State Marco Rubio suggesting a review of the license.
Wirth emphasized that Chevron aims to follow U.S. laws and stay away from political issues. However, he noted that if Chevron were to exit, it would open the door for state-owned oil companies from rival nations to take over in Venezuela. “When Western companies leave, we see nations like China and Russia increase their presence,” he explained.
Chevron has been a player in Venezuela for nearly 100 years and has successfully obtained license renewals, even during the previous Trump administration, despite increasing U.S. dissatisfaction with the Venezuelan government and resulting economic sanctions.
Last year, President Joe Biden’s administration allowed Chevron to expand its operations in Venezuela, hoping to improve conditions in a country led by President Nicolás Maduro, who has faced criticism for authoritarian practices. In October 2023, sanctions on Venezuela’s oil sector were eased, facilitating business with its state oil company, PDVSA.
However, Maduro’s recent actions—like going back on a promise to let the opposition choose a candidate for the presidential election—have drawn criticism. The outcome was widely seen as fraudulent and has led many to question if Western companies should continue operations in the country. Sanctions were reinstated last April, but Chevron’s license was still valid, allowing it to raise its production to about 200,000 barrels per day.
Venezuela’s opposition, particularly under leader María Corina Machado, is calling for the cancellation of Chevron’s license. Machado has warned foreign companies, including Chevron, against supporting Maduro’s administration.
Rubio has indicated he favors a stricter stance on Venezuela, pointing out in a recent confirmation hearing that the Biden administration had been misled by Maduro. He stated that companies like Chevron are unintentionally funneling significant funds into the Maduro regime, which hasn’t kept its promises.
Recently, as Maduro began another term, the outgoing Biden administration, along with the EU and UK, imposed coordinated sanctions on Venezuelan officials but decided against revoking the exemption licenses.
Some analysts believe fears about Chinese and Russian companies stepping in if Chevron withdraws are overstated. Francisco Monaldi, a Latin America energy expert, noted that these companies have been cautious over the past few years, especially amid U.S. sanctions.
Wirth concluded by highlighting that Chevron is still owed a considerable amount of money in Venezuela, underscoring the company’s focus on business rather than foreign policy.