CARACAS: The United States on Thursday eased sanctions on Venezuela’s oil industry, allowing US energy firms greater freedom to operate after the South American country lifted state controls over its oil sector.
The move came within an hour of the Venezuelan parliament approving reforms to open the industry to private investment. The US Treasury Department issued a general licence permitting activities including the export, sale, supply, storage, marketing, refining, and transportation of Venezuelan-origin oil.
Venezuela’s acting president Delcy Rodriguez described the reforms as a “historical leap” and said they marked “important steps” after a call with US President Donald Trump.
Return of US firms
The reform, adopted Thursday, could pave the way for the return of American energy majors two decades after former president Hugo Chavez nationalised foreign oil assets in 2007. The law removes the previous requirement for foreign companies to form joint ventures with the state-owned PDVSA, which had to hold a majority stake.
Jorge Rodriguez, head of parliament and brother of the acting president, said the reform would help Venezuela recover from years of US sanctions, stating: “Only good things will come after the suffering.”
Trump, who backed Rodriguez following a deadly US raid in Caracas on January 3, has said Washington is now “in charge” of Venezuela and that millions of barrels of oil will be sold at market price. Rodriguez has already used $300 million from the first US crude sale to stabilise the bolivar.
Economic revival and challenges
Venezuela holds roughly a fifth of the world’s oil reserves and was once a major supplier to the US. Production, devastated by underinvestment, corruption, and six years of sanctions, reached 1.2 million barrels per day in 2025 — up from 300,000 barrels in 2020, but far below the 3 million barrels at the start of the century.
US firms ExxonMobil and ConocoPhillips exited Venezuela in 2007 after refusing to cede majority control. Chevron remains the only American company operating under a sanctions exemption. The new law offers guarantees to private players, reduces state control over exploration, and lowers taxes and royalties.
Oil analyst Francisco Monaldi said, “This obviously completely dismantles Hugo Chavez’s oil model,” while noting the state will retain some discretion over contracts to private investors.
Future prospects
The US Department of Energy has unveiled a plan to develop Venezuela’s oil sector and is marketing its crude. Rodriguez said the reform will channel investment into new fields, areas that previously lacked infrastructure, and untapped reserves.
Workers and citizens have expressed cautious optimism. “This hydrocarbons reform helps restore our dignity,” said Karina Rodriguez, a PDVSA employee, at a recent rally.
