US oversees $5B oil deals between Venezuela and Chevron

US Energy Secretary Chris Leng oversees the signing of “tens of billions of dollars” in deals between Venezuela and three Western energy firms on Wednesday as Chevron, Italy’s ENI and GE Vernova finalise new contracts in Caracas.

The agreements mark the first major oil and gas investments by U.S. and European companies in Venezuela since sanctions were tightened in 2019. Washington loosened some restrictions last October, allowing Chevron to resume limited operations in a bid to boost global oil supply and ease pressure on gasoline prices. ENI and GE Vernova are also returning after years of limited access, betting that Venezuela’s untapped reserves—proven at 303 billion barrels—can offset supply risks from Russia and the Middle East. The deals come as the Biden administration seeks to stabilize energy markets ahead of the U.S. election and reduce reliance on OPEC+.

Chevron’s renewed presence is expected to focus on the Petropiar and Boscan fields, where it will invest in infrastructure and rehabilitation. ENI plans to expand gas production offshore in the Caribbean, targeting liquefied natural gas exports within three years. GE Vernova will supply turbines and equipment for refinery upgrades. While exact figures remain undisclosed, U.S. officials say the long-term value could exceed $50 billion if all expansions come online. Venezuelan interim president Delcy Rodriguez hailed the deals as a “turning point,” but warned that political risks and U.S. sanctions on other officials could still stall progress.

What happens next depends on enforcement. The U.S. Treasury has carved out a six-month window for Chevron to operate, renewable if Venezuela continues to reduce political prisoners and allow free elections. Analysts warn that progress could stall if Nicolas Maduro—still under U.S. indictment—reclaims power after any vote. Meanwhile, environmental groups have raised concerns over expanded drilling in the Orinoco Belt, home to fragile ecosystems. The deals are a gamble: they could stabilize global oil markets or collapse under political pressure—again.