Payments for Venezuelan oil will go into a special U.S.-controlled account, not to the Venezuelan state company that sells it. That condition sits at the center of a license the Treasury Department issued on Wednesday, March 18, easing sanctions on Petróleos de Venezuela S.A., known as PDVSA.
The Associated Press reported that the license lets PDVSA sell Venezuelan oil directly to U.S. companies and on global markets. For years Washington had largely blocked dealings with Venezuela’s government and its oil sector. The relief is targeted, not total: the penalties stay on the books.
Why now
The administration is looking for ways to bring down oil prices during the war with Iran, which began on Feb. 28. Iran halted traffic through the Strait of Hormuz, through which about one-fifth of the world’s oil normally passes. AAA put the national average for a gallon of regular gasoline at more than $3.84 on Wednesday, against $2.98 before the war.
“Gas prices are up and we know they’re up,” Vice President JD Vance said at an event in Auburn Hills, Michigan. “This is a temporary blip.”
A Treasury official, speaking to the AP without authorization to be named, said the license is meant to encourage investment in Venezuela’s energy sector and to benefit both countries while adding to global supply. Separately, the White House said Trump would waive Jones Act requirements for 60 days. President Trump also said last week he would tap the strategic petroleum reserve, and the administration eased sanctions on certain Russian oil shipments for 30 days.
What the license allows and bars
Companies that existed before Jan. 29, 2025, can buy Venezuelan oil and carry out transactions that sanctions would normally ban. Deals involving Russia, Iran, North Korea, Cuba and some Chinese entities are not allowed. Neither are transactions involving Venezuelan debt or bonds, or payments in gold or cryptocurrency, including the petro, the token Venezuela issued in 2018.
The AP summed up the arrangement this way: the U.S. will allow the oil trade but control the cash flow.
Since the ouster and arrest of Nicolás Maduro in a U.S. military operation in January, Trump has said the U.S. would effectively “run” Venezuela and sell its oil.
Limited effect at the pump
Geoff Ramsey, a Latin America expert at the Atlantic Council, said not to expect much short-term effect on gas prices. “We’re talking about 12 to 18 months before we see dramatic changes in Venezuelan output,” he said.
Claudio Galimberti, chief economist at Rystad Energy, said easing sanctions would normally move prices significantly, “but we are in the most abnormal market I can remember.” He said prices are likely to stay high and volatile until traffic resumes through Hormuz.
Criticism and background
Critics of the acting Venezuelan government argue the move rewards Maduro loyalists while repression, corruption and human rights abuses continue.
Venezuela sits on the world’s largest oil reserves. Production fell from 3.5 million barrels a day in 1999 to under 400,000 in 2020. The Treasury sanctioned PDVSA in 2019, which forced the government to sell its remaining oil at about 40% below market prices to buyers such as China. Many public sector workers now live on roughly $160 a month, and Venezuela’s central bank put inflation at 475% last year.
