The US oil company Chevron is navigating a delicate situation in Venezuela, where it remains the only foreign entity permitted to exploit the country’s vast oil reserves, the largest in the world. The recent escalation of US sanctions, including a total blockade of oil tankers, has put Chevron’s presence in Venezuela under scrutiny.

Chevron’s history in Venezuela dates back to 1923, when its predecessor, the Venezuelan Gulf Oil Company, began operating in the country. The company has since become a major player in Venezuela’s oil industry, extracting oil from four fields and offshore gas from another field, covering an area of nearly 30,000 hectares. This is part of a partnership with the state-owned company PDVSA and its affiliates, which employs around 3,000 people.

Venezuela holds approximately 303 billion barrels of oil reserves, accounting for 17% of the world’s total. The US embargo on Venezuelan crude oil, imposed in 2019, was relaxed in 2023, allowing Chevron to operate in the country. However, the company’s activities have been subject to various sanctions and restrictions, including a recent blockade that is expected to significantly reduce Venezuela’s illicit oil exports.

Chevron generates around 10% of Venezuela’s total oil production, which is estimated to be around 800,000 to 900,000 barrels per day. The company’s production is primarily high-sulfur oil, which is difficult to refine and is mainly exported to the United States. The US has refineries specifically designed to process this type of oil, which is converted into diesel or by-products such as asphalt.

Despite the challenges, Chevron maintains that its presence in Venezuela is a “stabilizing force” for the local economy and US energy security. The company operates in compliance with US sanctions and laws, and its activities are not affected by recent presidential decisions. The US needs for this oil are debated, with some experts suggesting that the country does not require it, but rather seeks to prevent other nations, such as China and Russia, from filling the vacuum created by its departure.

The situation highlights the complex geopolitical dynamics at play in the global oil industry, where economic and political interests often intersect. As the only foreign oil company operating in Venezuela, Chevron’s position is precarious, and its activities are closely watched by stakeholders around the world. The company’s ability to navigate these challenges will be crucial in determining the future of its operations in Venezuela and the broader implications for the global energy landscape.