The U.S. intends to compel more companies to stop operations in Venezuela, following Chevron’s mandate. Firms such as Etablissements Maurel & Prom SA face a 30-day deadline post-waiver revocation, with implications for Venezuela’s fragile economy. Discussions initiated by Trump advisers with Maduro could influence future policies regarding foreign oil operations.
The Trump administration is taking measures to compel additional companies to cease operations in Venezuela. Following Chevron Corp.’s directive to terminate its activities, the U.S. is targeting firms like Etablissements Maurel & Prom SA and an asphalt company owned by Harry Sargeant, providing them with a 30-day notice upon the revocation of their operational waivers. The U.S. Treasury is expected to begin this process imminently.
The cessation of these companies’ operations would significantly impact Venezuela’s struggling economy, exerting further pressure on President Nicolas Maduro. This comes as President Trump seeks a resolution concerning democratic reforms and the acceptance of more Venezuelan migrants into the U.S. Chevron has been instructed to conclude its dealings in Venezuela by April 3, substantially shortening the typical six-month wind-down period.
Venezuela’s economy relies heavily on oil, with Chevron and other permitted smaller companies playing vital roles in its economic activity. The country’s state oil company has faced severe deterioration due to prolonged underinvestment, making foreign operations crucial to economic stability.
Advisers within the Trump administration exhibit differing opinions regarding the approach to Venezuela, indicating that there may be a potential for policy shifts allowing oil companies to maintain their operations. Other international corporations, such as Repsol SA and Eni SpA, are also in limbo, awaiting confirmation on the status of their waivers against sanctions.
Joint ventures between Chevron and Petroleos de Venezuela SA have been instrumental to the Maduro administration, accounting for a significant portion of state revenues for 2023 and 2024. If Chevron were to exit, projections from the Finance Observatory suggest that Venezuela’s economy could contract by as much as 7.5% this year.
Dialogue initiated by Trump adviser Rick Grenell with Maduro in January led to direct negotiations and the release of six U.S. prisoners. Since this engagement, the U.S. has repatriated 166 Venezuelan migrants, with the last flight returning them to Caracas on February 20. In response to threats against Chevron’s operations, Maduro asserted that there would be no significant loss in production, stating, “output will not even fall one liter or barrel.”
The Trump administration is poised to escalate its efforts to drive more companies out of Venezuela, following Chevron’s directive to end operations. This action could exacerbate the already troubled Venezuelan economy and pressure President Maduro amidst discussions of democratic reforms. While various U.S. officials offer differing viewpoints on the future of oil operations in Venezuela, the potential withdrawal of major companies could lead to significant economic repercussions.
Original Source: www.livemint.com
