Chevron Resumes Venezuela Oil Exports Amid Shifting U.S. Sanctions

Chevron Corporation CVX has dispatched Venezuela’s two oil shipments to the United States after Washington restored its license to operate in the sanctioned nation. The Mediterranean Voyager and Canopus Voyager left Venezuela’s waters carrying Hamaca and Boscan heavy crudes, bound for the U.S. West Coast and Port Arthur, TX.

Balancing Energy Needs and Sanctions

This move highlights how U.S. energy security concerns can temper hardline sanction policies. With Mexico cutting exports and Canadian flows constrained, Chevron’s return provides much-needed supply relief.

Although the new sanctions waiver was not officially released, U.S. officials and analysts indicated that Chevron will avoid making cash payments to the Venezuelan state. Instead, both Chevron and Petróleos de Venezuela, S.A. (PDVSA) are expected to independently export their respective portions of crude output. Venezuela’s authorities, however, rejected the idea that Chevron would operate in the country without payments, but offered no additional clarification.

Modest but Strategic Flows

Chevron, currently carrying a Zacks Rank #3 (Hold), emphasized that volumes remain small, signaling a cautious start rather than a full revival of trade. Still, even limited exports could shift dynamics in the Gulf Coast heavy crude market, where refiners have faced sourcing challenges. For Venezuela, Chevron’s return offers operational stability in an oil sector struggling with sanctions and underinvestment.

Heavy Venezuelan crude remains valuable for U.S. refiners like Valero Energy Corporation VLO, which rely on such grades to run specialized coking units. Valero, which accounted for nearly half of U.S. imports of Venezuelan crude in 2024, is reportedly negotiating with Chevron to restart a supply deal.

The return of heavy crude supplies is anticipated to boost profit margins for Texas and Louisiana refiners, with companies like PBF Energy Inc. PBF and Phillips 66 PSX showing interest in resuming Venezuelan oil purchases from Chevron.

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Chevron’s Revoked License

In March this year, President Trump revoked Chevron’s license to operate in Venezuela, rolling back a concession previously granted by the Biden administration, even as U.S. sanctions on the country’s oil sector remained in place. Chevron was instructed to wind down operations by the end of May. Venezuela managed to withstand the renewed sanctions by building reserves and rerouting crude exports to China.

However, last month the U.S. reversed course, allowing Chevron to restart operations under strict conditions — specifically, that no proceeds from Venezuelan crude sales go to the Maduro government.

Geopolitical Reset in Motion

The reinstated flows illustrate how global energy realities can reshape U.S. foreign policy. While far from restoring Venezuela’s pre-crisis export strength, Chevron’s shipments represent both an economic lifeline for the country’s struggling industry and a strategic play for U.S. refiners seeking feedstock security.

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This article originally published on Zacks Investment Research (zacks.com).

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