President Donald Trump has announced that his administration will revoke Chevron’s license to operate in Venezuela, cutting off one of the country’s most significant financial lifelines. The decision, set to take effect on March 1, marks a major shift in U.S. policy toward Venezuela and is a sharp reversal from the Biden-era approach, which had allowed the oil giant to extract and export crude despite ongoing U.S. sanctions.
The move, which Trump announced on his social media platform Truth Social, effectively ends an agreement that had allowed Chevron to operate joint ventures with Venezuela’s state-run oil company PDVSA. Trump explained his decision by pointing to what he called the Maduro regime’s failure to uphold key commitments, particularly in deportations and democratic reforms.
“We are hereby reversing the concessions that Crooked Joe Biden gave to Nicolás Maduro, of Venezuela, on the oil transaction agreement, dated November 26, 2022, and also having to do with Electoral conditions within Venezuela, which have not been met by the Maduro regime,” Trump wrote.
He further claimed that Venezuela had failed to follow through on its pledge to take back deportees from the United States, particularly those with criminal records. “Additionally, the regime has not been transporting the violent criminals that they sent into our Country (the Good Ole’ U.S.A.) back to Venezuela at the rapid pace that they had agreed to,” he added.
Trump’s decision effectively ends what some saw as a fragile detente between Washington and Caracas. Just weeks earlier, Trump’s senior envoy Richard Grenell had traveled to Venezuela to meet with President Nicolás Maduro, securing the release of six Americans imprisoned in Venezuela and negotiating a plan for deportations. Many observers believed this signaled that Trump was willing to allow Venezuelan oil exports to continue. However, Wednesday’s announcement suggests a complete reversal of course.
Why Trump Revoked The License
The decision to revoke Chevron’s ability to operate in Venezuela is based on two primary concerns:
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Deportations of Venezuelan Migrants – The Biden administration had struck a deal with Venezuela that would allow for the deportation of Venezuelans who had entered the U.S. illegally, including members of the Tren de Aragua gang, which has been linked to violent crimes in the U.S. According to Trump, Maduro failed to uphold this agreement, and deportations were happening too slowly.
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Failure To Hold Free Elections – The Chevron license was originally granted as part of a broader U.S. strategy to pressure Maduro into allowing free and fair elections. However, the Venezuelan government-aligned electoral council declared Maduro the winner of the 2024 election, a result rejected by the Venezuelan opposition and many countries, including the U.S.
Secretary of State Marco Rubio reinforced Trump’s stance, posting on X that he would issue “foreign policy guidance to terminate all Biden-era oil and gas licenses that have shamefully bankrolled the illegitimate Maduro regime.”
Impact On The Oil Markets
The revocation of Chevron’s license has already caused oil prices to rise, increasing by more than 1% on Thursday as the market reacted to the disruption. With Venezuela producing just over 1 million barrels of oil per day, of which Chevron accounted for between 240,000 and 294,000 barrels, the decision eliminates a significant source of global crude supply.
Chevron had been shipping Venezuelan oil to its refineries in the U.S., helping to offset fluctuations in global supply. By cutting off this flow, Trump’s decision could lead to tighter oil markets and potential price increases for consumers.
Chevron’s CEO, Mike Wirth, had previously warned about the consequences of withdrawing from Venezuela, stating in an interview with the Financial Times that it would allow companies from China and Russia to expand their influence in the country. He also cautioned that further economic damage to Venezuela could drive more migration to the U.S., the very issue Trump is trying to address.
Venezuelan Vice President Delcy Rodríguez condemned the decision, calling it “damaging and inexplicable.” She argued that U.S. sanctions had worsened Venezuela’s economic crisis and contributed to the mass migration of Venezuelans northward.
How Venezuela Will Be Affected
For Venezuela, the impact of this decision could be severe. The revenue generated through its oil exports to the U.S. has provided a much-needed financial cushion for the struggling economy. With Chevron pulling out, PDVSA will be forced to find alternative buyers, likely among China, Russia, and India, which tend to demand steep discounts on Venezuelan crude.
Rodríguez warned that the sanctions could trigger a new wave of Venezuelan migration to the U.S., something she says the Biden administration had tried to avoid with its previous approach. “The U.S. government has made a damaging and inexplicable decision by announcing sanctions against the U.S. company Chevron,” she said.
Opposition leaders in Venezuela, however, saw the move as a potential step toward democratic change. María Corina Machado, an opposition leader who has been in hiding to avoid arrest, reacted to the announcement while recording a podcast with Donald Trump Jr. “This is proof for me that President Trump is on the side of the Venezuelan people, of democracy and prosperity for the U.S. and for Venezuela as well,” she said.
Trump’s move is in line with a long-standing argument from the Venezuelan opposition, which has called for Chevron’s license to be revoked. They believe that continuing oil operations only strengthens Maduro’s hold on power by providing him with a steady flow of cash to sustain his regime.
Trump’s Goals And Political Calculations
Trump’s decision to revoke the Chevron license aligns with his broader foreign policy and domestic political strategy:
- Crackdown On Immigration – The decision is part of Trump’s broader effort to tighten U.S. borders and increase deportations. By revoking the Chevron license, he is leveraging economic pressure to force Venezuela to take back deported migrants.
- A Return To “Maximum Pressure” On Maduro – Trump’s first term was marked by an aggressive sanctions campaign against Venezuela, aimed at financially isolating Maduro. The Biden administration had relaxed some of these measures, but Trump’s decision signals a return to a more confrontational approach.
- Winning Support Among Florida’s Venezuelan-American Voters – Venezuelan immigrants in Florida overwhelmingly oppose Maduro, and many support Trump’s hardline stance. By taking a tougher position on Venezuela, Trump strengthens his appeal to this key voting bloc in an important swing state.
What Happens Next?
The revocation of Chevron’s license is likely to have several consequences:
- Escalating Tensions Between The U.S. And Venezuela – Maduro may retaliate by strengthening ties with Russia, China, and Iran, further complicating U.S. relations in the region.
- Potential Impact On Global Oil Prices – If Venezuela struggles to redirect its oil exports, the global market could experience volatility, potentially increasing prices for U.S. consumers.
- Further Isolation Of The Maduro Regime – With the U.S. cutting off a key financial channel, Maduro’s ability to maintain power could be weakened, though he has so far proven resilient to economic pressure.
Geoff Ramsey, a Venezuela expert at the Atlantic Council, believes Trump is using this leverage to extract political concessions. “This gives the administration space to push harder on the Maduro regime not only on oil interests and migration cooperation, but also on democratic reforms and the release of political prisoners,” he said.
The big question now is whether Trump’s strategy will lead to real change in Venezuela or simply deepen the country’s economic and political crisis. Either way, this move represents one of the most significant shifts in U.S. policy toward Venezuela in recent years, and its ripple effects will be felt in Washington, Caracas, and the global oil market for months to come.
