According to foreign sources on October 19th, according to analysts' predictions, if the United States relaxes its oil sanctions for a permanent period, Venezuela may increase its crude oil production by 25% from its current level.
According to estimates, Venezuela's current oil production is approximately 800000 barrels per day. Analysts say relaxing sanctions will allow the South American country, which has the world's largest crude oil reserves, to increase production by 200000 barrels per day, although the timing of achieving this increase is still uncertain.
After the Maduro government and opposition in Venezuela agreed to international supervision of the upcoming elections, the United States announced on October 18th the temporary lifting of multiple sanctions against Venezuela, including those on the oil and gas industry.
In addition to lifting the secondary trade ban, the US Treasury Department issued general licenses authorizing transactions involving Venezuela's oil and gas industry and gold industry
The statement states: "If representatives of the Maduro government do not comply with their commitments, the Ministry of Finance is prepared to modify or revoke the authorization at any time.
More specifically, the United States has issued a general license for a period of six months, temporarily authorizing transactions with the Venezuelan oil and gas industry, but the license will only be extended if Venezuela fulfills its commitments under the election roadmap and promises to release those unjustly detained.
This license is valid on April 18, 2024 and authorizes Venezuela to produce, enhance, sell, and export oil or gas, provide related goods and services, and pay bills for goods or services related to the operation of Venezuela's oil or gas sector. It also authorizes new investments in Venezuelan oil or gas, and authorizes the transportation of oil and gas from Venezuela to creditors of the Venezuelan government (including creditors of the Venezuelan National Oil Company) to repay debts.
The relaxation of regulations may increase the amount of heavy crude oil imported by the United States from Venezuela. As of Wednesday, Chevron was the only Western oil giant to receive special authorization to operate oil fields and export crude oil in Venezuela, which was a special license issued by the Biden government at the end of last year.
The increase in Venezuela's oil production and exports also helps to alleviate the global oil supply shortage.
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