Trump administration grants Chevron limited license to resume maintenance-level pumping in Venezuela, reversing previous ban - WSJ

Trump administration grants Chevron limited license to resume maintenance-level pumping in Venezuela, reversing previous ban - WSJ

The Trump administration has granted Chevron Corp (NYSE: CVX) permission to resume maintenance-level oil production in Venezuela, reversing a previous ban imposed by the Biden administration. The development, reported by The Wall Street Journal, comes after recent discussions involving President Trump and Secretary of State Marco Rubio, which also resulted in the release of 10 detained Americans in Venezuela [1].

The agreement, while still lacking specific details, aims to ensure that no royalties or taxes flow to the Maduro regime. Chevron, which had previously been barred from pumping oil in Venezuela, will now be allowed to conduct maintenance-level operations under the new arrangement. The company’s stock has seen a 1% increase in response to the news, as of 1:00 pm ET [1].

Chevron’s spokesperson, Bill Turenne, stated that the company conducts its business globally in compliance with applicable laws and regulations, including those related to sanctions in Venezuela. The move signifies a policy reversal for the Trump administration, which had revoked Chevron’s license to pump oil in the country earlier this year [1].

The development has been well-received by investors, with Chevron’s stock gaining 1.2% in midday trade on Thursday. Retail sentiment on Stocktwits has moved higher within the ‘bullish’ zone, reflecting investor optimism about the potential for Chevron to resume operations in Venezuela [2].

The exact mechanisms for the new arrangement remain unclear, but the agreement is seen as a significant step towards maintaining Chevron’s presence in Venezuela while avoiding direct financial support for the Maduro regime. As the situation evolves, further details about the agreement are expected to emerge.

References:
[1] https://finance.yahoo.com/news/chevron-resume-oil-operations-venezuela-172858062.html
[2] https://stocktwits.com/news-articles/markets/equity/chevron-gets-trump-administration-nod-to-resume-oil-production-in-venezuela/ch8zc3vR5HM