Chevron’s (CVX) access to lucrative Venezuela oil fields is under review, President Donald Trump said on Tuesday, suggesting an imminent end to the oil major’s exemption from U.S. sanctions on the South American nation.
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Speaking at his Mar-a-Lago club, Trump said the White House was “looking at the whole situation,” in reference to chilly relations with Venezuelan president Nicolas Maduro, which it had been thought may be thawing after he released America prisoners and accepted deported immigrants from the U.S.
But in remarks reported by Bloomberg, Trump seemed less inclined to allow CVX to continue oil exports. “Maybe not,” he said in response to a question about whether he would let the company continue to operate in Venezuela.
U.S. Steps Up Pressure on Maduro
It comes as the White House steps up pressure on Venezuela and embarks on a broader trade war. Recently, Trump’s Secretary of State Marco Rubio said the U.S. should reconsider Chevron’s sanctions waiver, which last year saw it produce about a fifth of Venezuela’s oil.
“Now they have these general licenses where companies like Chevron are actually providing billions of dollars of money into the regime’s coffers, and the regime kept none of the promises that they made,” Rubio said. “So, all that needs to be re-explored.”
The last administration granted a license to Chevron to expand its Venezuela business in 2022, while broader oil sanctions on the country were lifted in October 2023. However, President Nicolas Maduro reneged on his commitment to hold free and fair elections, which led the U.S. to reimpose oil sanctions in April last year. Chevron’s exemption was kept in place, allowing it to produce around 180,000 barrels per day in the country last year.
On Tuesday though Trump criticized the Biden administration for allowing Venezuela to profit from oil riches.
Under the last administration the U.S., he said, “started paying a fortune to Venezuela. And we’re looking at that actually. Why did they do that? Why were they doing that? Why would they go to the enemy and give them billions and billions of dollars?”
CVX in Contact with White House
Speaking earlier this month, Chevron CEO Mike Wirth said the company was in talks with the White House. “We are in contact with the current administration,” he told Bloomberg Television.
And speaking to the Financial Times last month after Chevron’s earnings update, Wirth suggested ending its waiver would end up ceding U.S. influence to other nations. “In Venezuela, in particular, what you have seen when countries from the west leave, you’ve seen companies from China, from Russia, increase their presence as a result,” he said.
Is CVX a Buy?
Overall, Wall Street has a Strong Buy consensus rating on CVX stock, based on 14 Buys and three Holds. The average CVX price target of $177.00 implies 13% upside from current levels, with the stock having risen 10% in the last 12 months.
