Venezuela sanctions loosen as NATO’s war drags on

Desperation for the country’s crude puts overthrow plans on hold

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Last year was a relatively good one for Venezuela. In November, the United States lifted some sanctions for oil giant Chevron to resume joint operations with Venezuela’s state-owned petroleum company PDVSA. The move was the biggest thaw in relations between the two countries since a full-blown U.S- imposed oil embargo in 2019. The embargo came on top of extensive sanctions responsible for the country’s recent economic misery.

Chevron now reports that it is producing 90,000 barrels per day in Venezuela and is expecting to increase it in 2023. It has dispatched the tankers Caribbean Voyager and UACC Eagle to ship the crude to refineries in Mississippi that were previously refining Russian oil. Production is picking up from a nadir three years ago. Venezuela on the whole is now producing around 676,000 barrels per day, still a third of 2017’s level, and below Caracas’ goal of producing more than a million barrels per day. 

Venezuela faces several challenges to meeting these oil production goals:

• Venezuela remains cut off from financial markets, making an overhaul of its infrastructure corroded by sanctions nearly impossible.

• Russia is selling oil to China at a discount, undercutting Venezuelan exports.

• Ongoing acts of sabotage targeting the country’s oil pipelines and facilities.

• Three-quarters of Venezuela’s oil is very sour -- high in sulfur content -- and heavy, so more expensive and carbon intensive to refine.