Andean Group - April 2026

Amid global oil shortages due to the conflict with Iran, the US has stepped up its efforts to facilitate the return of Venezuelan crude to international markets. In March, Washington announced a further easing of longstanding sanctions on Venezuela’s oil and mineral sectors, while President Delcy Rodríguez appointed an oil engineer as hydrocarbons minister, a role which Rodríguez had been carrying out herself since August 2024 when she was still vice president under Nicolás Maduro (2013-2026).

On 18 March the US Treasury Department’s Office of Foreign Assets Control (Ofac) issued General Licence 52, which broadly allows Venezuela’s state oil company Petróleos de Venezuela (Pdvsa) to sell Venezuelan crude directly to US companies and markets around the world. This, the latest in a succession of Venezuela-oriented licences emitted by Ofac, is a complete reversal of Washington’s years-long Venezuela policy, which had sanctioned almost all activity within the country’s oil sector.

The move is designed to attract new investment to Venezuela’s energy sector, benefitting both countries and increasing the global oil supply, a Treasury official told The Associated Press. Indeed, the goal is to ramp up production of the heavy crude oil that many US Gulf Coast refineries are specifically designed to process. More foreign oil companies are also expected to be allowed to operate in Venezuela’s energy and petrochemical sectors soon. Initially Washington had issued licences to only a few companies, including Chevron (US), BP (UK), Shell (UK), Repsol (Spain), Eni (Italy), and Maurel & Prom (France).

Following its capture of Maduro in a spectacularly executed military operation in January, President Donald Trump’s administration took control of Venezuelan crude exports and called on private companies to spend around US$100bn to rebuild the nation’s decrepit oil sector. The Trump administration in March also amended licences to allow US imports of fertilisers from Venezuela, as well as repair works in the country’s electricity grid. Venezuela’s power infrastructure remains in a precarious state, and expanding power capacity is a precondition for a recovery of the oil industry.

Then, on 27 March Ofac issued another licence authorising transactions related to the mining and processing of minerals in Venezuela, and the entry into contingent investment contracts in the mineral sector. While the immediate focus remains on boosting the supply of oil, the US is also looking to secure supply chains for minerals essential to modern technology and infrastructure. For now, Venezuela’s limited industrial mining operations are focused on gold, but in the long-term there will be US interest in securing access to the country’s untapped deposits of critical minerals such as bauxite and coltan.

By providing a legal pathway for these transactions, the US is encouraging a more transparent and regulated extraction process, which officials hope will provide the Venezuelan economy with the liquidity needed to repair its crumbling energy infrastructure.

Oil minister

As the US relaxes its restrictions, the Venezuelan government is also taking steps to modernise its oil sector management. On 11 March President Rodríguez appointed Paula Henao as the country’s new hydrocarbons minister. Henao takes over the portfolio from Rodríguez herself, who had held the position since August 2024 alongside her former role as vice president (2018-2026). Henao’s appointment is seen as a strategic move to place a dedicated professional at the helm of the ministry during a critical period of re-engagement. Henao’s primary responsibility will be to oversee the expected influx of foreign investment and to coordinate with Pdvsa to increase output.

Despite the rapprochement with Washington, serious doubts remain regarding the prospects of a swift and sustainable oil production increase. In addition to the complex infrastructure issues still to be fixed, there are signs of growing discord in Rodríguez’s party over the extent of US influence. At the time of writing in late March, a debate on a US-backed mining reform had been twice delayed in a sign that some deputies in the ruling Partido Socialista Unido de Venezuela (PSUV) may be resisting the country’s domination by Washington. At the same time, the planned return of exiled opposition leader María Corina Machado, which has reportedly been discouraged by Trump, would ramp up the pressure for elections and pose a major challenge to the current regime.

Diplomatic ties restored

Topping off its reconciliation with Caracas, the US reopened its embassy in Caracas on 30 March, seven years after it was closed during Trump’s first term. Venezuela returned to its embassy in Washington two days earlier. Since 2019 only limited diplomatic engagement had taken place between the two countries and was carried out through the Venezuela Affairs Unit at the US embassy in Colombia’s capital Bogotá. Laura Dogu is US ambassador in Caracas, and Félix Plasencia is Venezuela’s ambassador to Washington.