US Set to Greenlight Oil Production in Venezuela

The U.S. government is preparing to issue a general license that would permit companies to resume pumping oil in Venezuela. This marks a critical step in the Trump administration's plan to ease sanctions and rebuild the nation's struggling energy sector.

Sources familiar with the plan indicate the Treasury Department could release the new license as early as this week. While the Treasury has not officially commented, the White House has signaled its intent.

"The President's team is working around the clock to ensure oil companies are able to make investments in Venezuela's oil infrastructure. Stay tuned!" said Taylor Rogers, a White House spokeswoman.

This policy shift is designed to attract U.S.-linked companies to help rebuild production in Venezuela, a nation with some of the world's largest oil reserves. The move follows a U.S. military operation in Caracas that resulted in the capture of former President Nicolás Maduro.

A Broader Strategy to Revive the Oil Sector

The upcoming license for production builds on previous measures aimed at restarting Venezuela's oil trade. Last week, the U.S. issued a separate general license authorizing companies to buy and sell Venezuelan crude. That license covered downstream activities like loading, exporting, and refining oil, provided the operations were handled by an "established US entity."

Before that, the administration had granted individual approvals to trading giants Trafigura Group and Vitol Group to restart Venezuelan oil sales. These moves helped clear a bottleneck caused by a partial U.S. naval blockade that had stifled exports and filled the country's storage tanks to capacity.

With exports flowing again, Venezuela's heavy sour crude is re-entering the global market. The primary destination is now shifting from Chinese buyers, who had absorbed discounted supply under previous sanctions, back to U.S. refiners, which were historically the top market for Venezuelan oil.

The New Political and Economic Framework

Following the capture of Maduro by U.S. forces on January 3, the Trump administration has backed his former vice president, Delcy Rodríguez. A core part of its stabilization plan involves asserting control over Venezuela's dilapidated oil industry.

A central pillar of this strategy is a new payment system. Companies with U.S. connections operating in Venezuela are now required to deposit payments into a U.S.-controlled bank account in Qatar. The Trump administration then releases these funds to Venezuela's Central Bank, which in turn auctions the dollars to private local operators.

Investor Caution and Signs of Opening

Despite these new frameworks, companies without an existing presence in Venezuela remain cautious. According to sources, concerns about political risk and the long-term stability of the current government are holding back new investment.

Still, the Rodríguez government is taking steps to improve the business climate, running parallel to the U.S. initiatives. These measures include:

• Improving fiscal terms for oil companies.

• Releasing political prisoners.

• Separately, the U.S. has reopened Venezuelan airspace to commercial flights.