The Biden Administration granted Chevron a license to produce and export oil from Venezuela in a limited capacity. File Photo by Mohammad Kheirkhah/UPI | License Photo
Nov. 27 (UPI) -- The U.S. Treasury Department announced a six-month license allowing oil giant Chevron to produce and export oil from Venezuela.
The United States sanctioned Venezuela under the regime of President Nicolás Maduro, greatly impacting the country's oil market and overall economy. Under Maduro, the country has operated under what some opponents describe as a dictatorship. The department claims its loosening of sanctions is a response to Maduro and Venezuela resuming humanitarian talks with his political opponents.
The license authorizes Chevron to resume natural resource extraction in Venezuela in a limited capacity. According to a press release Saturday from the Treasury Department: "This action reflects longstanding U.S. policy to provide targeted sanctions relief based on concrete steps that alleviate the suffering of the Venezuelan people and support the restoration of democracy."
Petróleos de Venezuela, Venezuela's state-owned oil company, will be restricted from profiting off oil sales by Chevron.
The move to open up the oil supply from Venezuela to the U.S. market ahead of potential new sanctions against Russia by the European Union. The European Commission is expected to trigger new sanctions against Russian energy on Dec. 5. It will include a ban on all Russian seaborne crude oil and petroleum products, which is about 90% of Europe's Russian oil imports.
According to Politico, a senior administration official said the easing of sanctions against Venezuela is not in response to oil prices.
"This action is not being taken in response to energy prices, this is a limited license. As we have said in the past, this is about the regime taking the steps needed to support the restoration of democracy in Venezuela," the official said.
Sen. Bob Menendez, D-N.J., the chairman of the Senate Foreign Affairs Committee, said the United States would not hesitate to re-institute sanctions should Maduro fall short on his part of negotiations. The six month license can be revoked at any time.
Venezuela produces about 300 billion barrels of oil per day. It has one of the largest oil reserves in the world.