Trump plan risks $1B in Venezuela oil revenue

Former National Security Council director Benjamin Gedan said the Trump administration’s plan to revive Venezuelan oil production is unlikely to succeed. In an interview on NPR with host Michel Martin, Gedan explained that lifting sanctions and negotiating a deal with the state‑run PDVSA would face serious technical, political, and economic hurdles. The plan was announced in early 2020 after the United States and the United Nations imposed a series of sanctions that cut Venezuela’s oil exports.

The issue matters because Venezuela’s economy depends almost entirely on oil revenue. In 2019 the country produced about 1.6 million barrels a day, but sanctions and mismanagement reduced output to under 500,000 barrels a day. The Trump administration hoped that a “humanitarian” oil deal could bring in $1–2 billion in revenue for the Maduro regime, while also giving U.S. oil companies a foothold in a lucrative market. The move would signal a shift from the previous policy of isolating the government and could change the balance of power in the region.

Gedan pointed out that the plan would need to overcome several obstacles. First, the U.S. Treasury’s Office of Foreign Assets Control would have to issue a waiver, a process that is slow and uncertain. Second, PDVSA’s infrastructure is in disrepair; it would need billions of dollars in investment that the company cannot currently raise. Third, the Venezuelan government has a history of reneging on agreements, and U.S. oil firms would face political risk and possible legal liability. Finally, the plan would be criticized by many Latin American allies who see it as a backdoor to undermine a sovereign nation.

If the administration proceeds, it will likely seek a multilateral agreement that includes guarantees for U.S. investors and a phased lifting of sanctions. The outcome will shape U.S. relations with Latin American partners and could influence future sanctions policy. Meanwhile, the Venezuelan government is expected to reject any deal that does not address its political crisis, making the viability of the plan even more uncertain.