U.S. eases sanctions on Venezuelan oil and air services

Venezuela, home to the world’s largest crude oil reserves, has taken a dramatic turn in its oil policy. Just weeks after former President Nicolás Maduro was detained in a U.S. military operation, interim President Delcy Rodríguez signed a landmark law aimed at revitalizing the country’s oil sector, the engine of its economy. The legislation relaxes decades of government monopoly over the industry, opening the door to private and foreign investment. In support of these reforms, the U.S. Treasury Department lifted stringent oil sanctions on Venezuela, issuing General License Number 46 .

The new law, approved by the Venezuelan National Assembly, is set to transform the country’s economic trajectory. It moves away from the outdated socialist principles of the past two decades, granting private companies a significant role in oil production, sales, and pricing. This effectively ends the decades-long monopoly of state-owned PDVSA . The government believes that with private sector participation, the collapsed oil sector can be revived. To attract investors, the law caps royalties at 30% and allows the government to further reduce this rate based on project investment size. Additionally, major changes have been made to dispute resolution mechanisms to instill confidence in foreign companies. Future conflicts will not be restricted to Venezuelan courts but can also be taken to international arbitration , easing concerns about nationalization reminiscent of the Chávez era.

Despite the easing of sanctions, the U.S. maintains strict oversight of revenues from Venezuelan oil sales. Funds from these sales must be deposited into designated blocked accounts in the U.S. , preventing direct access by Venezuela. For instance, funds from a $250 million deal with major oil trader Vitol will be managed under this system. The U.S. has also imposed strict conditions on the use of these funds. The Rodríguez government may spend them only on essential public needs , such as medicine, food, healthcare, and policing. Budget proposals must receive U.S. approval in advance, and independent audits are mandatory. Furthermore, Venezuela is prohibited from entering oil agreements with entities from China, Russia, Cuba, Iran, or North Korea .

Under Hugo Chávez, oil was used as a tool for socialist revolution, and foreign company assets were nationalized. Between 1999 and 2011, approximately $981 billion in revenue was lost to corruption and mismanagement, pushing the country into an economic crisis. The Rodríguez administration is now reversing these policies. She stated, “This is about the secure future we are leaving for our children.”

As part of economic normalization, President Donald Trump announced the reopening of Venezuela’s commercial airspace. American Airlines is preparing to resume services soon. While oil workers have welcomed these reforms, former minister Rafael Ramírez criticized them as undermining national achievements. Whether these bold geopolitical and economic changes will restore Venezuela from the crisis remains to be seen.