In a press release, the U.S. Department of the Treasury confirmed the move, adding that it had allowed Chevron to proceed with "natural resource extraction operations." The statement also mentioned that Venezuelan President Nicolas Maduro and the opposition coalition Unitary Platform (PU) reached a deal to enforce a humanitarian program and resume talks to hold free and fair elections.
"The announcements by the PU and the Maduro regime are important steps in the right direction to restore democracy in the country," said the Treasury Department. "The U.S. welcomes and supports the reopening of negotiations between [PU] and the Maduro regime as part of our longstanding policy to support the peaceful restoration of democracy, free and fair elections, and respect for the rights and freedoms of Venezuelans."
According to a report by the Wall Street Journal, Washington agreed to give Chevron's license after the Venezuelan leader promised to carry out his commitments outlined during talks with the opposition coalition.
Chevron is the last remaining American petroleum company in Venezuela. However, Caracas banned it from pumping oil due to sanctions imposed on Maduro.
The New York Times said that despite having the world's biggest oil reserves, foreign investment in oil is something the Maduro government seriously needs in order to improve its failing economy. The development involving Chevron also marks an opening for other petroleum companies to continue business in Venezuela, two years after former U.S. President Donald Trump took strong action against the South American country.
The license granted by the Treasury Department to Chevron allows it to pump alongside Petroleos de Venezuela SA (PDVSA), the state-owned oil and natural gas company, in a joint venture. However, it prohibits the Venezuelan state oil company from receiving profits from Chevron's oil sales. Other activities with PDVSA are also forbidden, the department added.
"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," said an unnamed Biden administration official.
"We have long made clear we believe the best solution in Venezuela is a negotiated one between Venezuelans. To encourage this, we have also said we were willing to provide targeted sanctions relief."
The official nonetheless stated that extra action would demand more "concrete steps," as well as the release of political prisoners and permitting United Nations humanitarian missions into Venezuela. Other U.S. sanctions and restrictions enforced against Venezuela will continue to be enforced.
Although connected to political changes in Venezuela, the move could keep gas prices down by increasing more oil in the worldwide market. U.S. officials had earlier proposed to lessen some sanctions on Venezuela to support peace agreements between the opposition and the Maduro government.
Meanwhile, as energy prices have increased and fueled inflation, U.S. President Joe Biden released more than 200 million barrels of America's emergency oil reserves to supply relief at the pump. (Related: Biden begging socialist Venezuela for oil after killing US energy independence.)
The Biden administration has backed foreign governments like Venezuela to boost oil production also amidst global shortages created by sanctions against Russia for the conflict in Ukraine, OPEC+ declaring production cuts, and dwindling production in U.S. shale.
Follow FuelSupply.news for more news about America's oil supply.
Watch this Fox News clip denouncing the Biden administration for allowing Chevron to resume operations in Venezuela.
This video is from the NewsClips channel on Brighteon.com.