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Venezuela’s parliament approved sweeping oil sector reforms on January 30, prompting the United States to immediately ease sanctions and allowing American companies to resume trading with state oil firm PDVSA for the first time in years.
Within an hour of lawmakers in Caracas voting to open the oil industry to private investment, the US Treasury Department issued a general license authorizing activities including oil refining. Acting President Delcy Rodríguez called the reform a “historical leap” following a call with President Donald Trump, who also announced the reopening of Venezuela’s airspace.
Oil Giants Tread Carefully on Trump’s Investment Push
Despite President Trump’s call for $100 billion in investment to rebuild Venezuela’s oil industry, major US energy companies are maintaining cautious approaches. During earnings calls on January 31, CEOs of Exxon Mobil and Chevron emphasized the need for political stability and legal protections before committing significant new capital.
Chevron CEO Mike Wirth told analysts the company would “remain focused on value and capital discipline,” noting that while Venezuela represents a large resource opportunity, “we need to see stability in the country” and “confidence in the fiscal regime.” Chevron plans to finance its Venezuelan operations through cash from existing assets, potentially growing production by up to 50% without drawing on its global capital budget.
Chevron currently holds a unique advantage as the only US oil major operating in Venezuela under a special sanctions exemption, positioning it ahead of competitors like Exxon Mobil and ConocoPhillips, which exited in 2007 after refusing to cede majority control to the state.
Historic Overhaul of Socialist Oil Policy
The reforms fundamentally dismantle Hugo Chávez’s nationalist oil model, according to oil analyst Francisco Monaldi. The new law modifies 2006 legislation that forced foreign investors into joint ventures with PDVSA while requiring the state company to maintain majority stakes.
The revised framework offers greater guarantees to private players, relinquishes state control of exploration, and reduces taxes and royalties. Jorge Rodríguez, National Assembly president and brother of Venezuela’s interim leader, said the reform will help the country recover from years under US sanctions, declaring “only good things will come after the suffering.”
Venezuela has already invested $300 million from initial US crude sales into supporting its struggling currency, the bolívar. The country sits on approximately one-fifth of global oil reserves and was once a major US crude supplier before Chávez’s nationalizations began in 2007.
Production Recovery Still Faces Challenges
Venezuela’s oil industry reached 1.2 million barrels per day in 2025, marking significant progress from the 300,000 barrels daily in 2020, though still far below the three million barrels achieved at the century’s start. The sector continues recovering from years of underinvestment, corruption, and mismanagement compounded by six years of US sanctions.
The US Department of Energy has unveiled plans to develop Venezuela’s oil industry and begun marketing Venezuelan crude. Acting President Rodríguez expects the reforms to bring investment to “new fields, to fields where there has never been investment, and to fields where there is no infrastructure,” offering hope for a country battling economic collapse and mass emigration.
Sources: Financialpost, Batimes
