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The administration of US President Joe Biden has issued a permit authorizing Chevron to resume limited oil extraction operations in Venezuela.
The permit, issued on Saturday, restricts Petroleos de Venezuela (PdVSA) from profiting from the sale of oil to US energy company Chevron. The permit allows Chevron’s joint ventures to operate in Venezuela and does not authorize any other engagement with PdVSA. Other sanctions and restrictions imposed by the US on Venezuela remain in effect.
Under General License 41 of the US Department of the Treasury (USDT), Chevron secured a six-month license from the US Office of Foreign Assets Control (OFAC). This allows the company to produce crude oil and petroleum products in its projects in Venezuela. The company can maintain and repair the oil fields there even though no new drilling is allowed.
“OFAC’s decision brings additional transparency to the Venezuelan oil sector.” Issuance of General License no. 41 means that Chevron can now commercialize the oil that is currently being produced from the company’s joint venture assets,” said a Chevron representative. Bloomberg News.
The Trump administration imposed sanctions against Venezuelan President Nicolás Maduro Moros in 2019 for stealing Venezuelan property and natural resources. At the time, Chevron was only allowed to keep its assets in Venezuela and not to export oil or expand operations.
According to a senior US administration official who briefed reporters on Saturday, the six-month permit would be open to change if “the Maduro regime does not negotiate in good faith or follow through on its commitments.”
The Washington Post reported that a senior US government official has denied claims that the administration is taking steps to reduce high energy prices due to Russia’s invasion of Ukraine.
“Allowing Chevron to start lifting oil from Venezuela is not something that will affect international oil prices.” This is really about Venezuela and the Venezuelan process,” the official said, adding that the U.S. “[supports] a peaceful solution to the political, humanitarian and economic crisis through negotiations”.
The decision to authorize Chevron to resume shipments from South America comes ahead of a Dec. 5 deadline to increase sanctions against Russia. According to Politico newsThe G-7 and the European Union are considering limiting Russian oil exports and imposing price caps on oil sales.
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