Venezuela’s interim President Delcy Rodriguez has pushed through a major reform of her country’s hydrocarbon law to allow greater private investment in the oil industry (Federico PARRA) · Federico PARRA/AFP/AFP
The United States on Thursday eased sanctions on Venezuela’s oil industry after Venezuelan lawmakers passed reforms paving the way for US companies to return — a key goal of President Donald Trump’s intervention in the country.
Within an hour of lawmakers in Caracas voting to open the oil industry to private investment, the US Treasury Department issued a general license allowing US companies to trade with state oil firm PDVSA.
The activities authorized include the refining of oil, the license said.
Addressing oil industry workers, Venezuela’s acting president Delcy Rodriguez hailed the reform as a “historical leap.”
“We are taking historic steps,” Rodriguez said after a call with Trump, who also announced the reopening of Venezuela’s airspace.
– ‘For the future’ –
Trump pressured Caracas to open up its oil fields to American investors after overthrowing his socialist arch-foe Nicolas Maduro in a deadly US raid on January 3.
The US president backed Maduro’s deputy Rodriguez to take over, on the proviso that she give Washington access to the world’s largest proven oil reserves.
Rodriguez has appeared eager to comply with his demands, arguing that an influx of foreign capital is needed to revive the battered Venezuelan economy.
The reform adopted Thursday paves the way for the return of US energy majors, two decades after socialist firebrand Hugo Chavez seized foreign oil fields.
It modifies a law dating to 2006 that forced foreign investors to form joint ventures with state oil company PDVSA, which insisted on a majority stake.
Jorge Rodriguez, head of parliament and brother of Venezuela’s new acting president, said the reform will help the country recover from years of living under US sanctions.
“Only good things will come after the suffering,” he said as he gavelled through the law “for history, for the future.”
Trump has said Washington is now “in charge” of Venezuela and Rodriguez will be “turning over” millions of barrels of oil to be sold at market price.
Rodriguez has already ploughed $300 million from a first US sale of Venezuelan crude into shoring up the country’s struggling currency, the bolivar.
– Slow recovery –
Venezuela sits on about a fifth of the world’s oil reserves.
It was once a major crude supplier to the United States, and multiple American firms operated in the country until 2007, when Chavez led a new wave of nationalizations.
The industry is undergoing a slow recovery after being walloped by years of underinvestment, corruption, mismanagement and six years of US sanctions.