US Set to Lift Venezuela Sanctions for Oil Trade

The United States could begin lifting sanctions on Venezuela as soon as next week to facilitate oil sales, according to Treasury Secretary Scott Bessent. The move is part of a broader strategy to re-engage with the country following the capture of Venezuelan leader Nicolas Maduro.

In an interview on Friday, Bessent stated the Treasury is examining changes that would allow the proceeds from oil sales—much of it currently stored on ships—to be repatriated to Venezuela.

"We're de-sanctioning the oil that's going to be sold," he said. The administration's focus, he explained, is on how these funds "can help... run the government, run the security services and get it to the Venezuelan people."

When asked about the timeline, Bessent confirmed that sanctions could be removed "as soon as next week," though he did not specify which measures would be lifted. This policy shift is central to the Trump administration's efforts to stabilize Venezuela and encourage the return of U.S. oil producers.

IMF and World Bank Poised for Re-Engagement

Alongside sanctions relief, the U.S. is pushing for Venezuela's reintegration into the global financial system. Bessent, who represents the U.S. at the International Monetary Fund and the World Bank, confirmed he will meet with the heads of both institutions next week to discuss their re-engagement with Venezuela.

A key part of this plan involves unlocking nearly $5 billion of Venezuela's assets held at the IMF in the form of Special Drawing Rights (SDRs). Bessent said the Treasury would be willing to convert the country's 3.59 billion SDRs, valued at approximately $4.9 billion, into dollars to help rebuild the economy. These assets are currently inaccessible to Venezuela.

U.S. Treasury Secretary Scott Bessent outlines the administration's economic plans for Venezuela.

This approach mirrors a previous U.S. action, when the Treasury backed a $20 billion swap line for Argentina using its SDRs to stabilize the peso. An IMF spokesperson confirmed the fund is monitoring developments in Venezuela but declined to comment on the upcoming meeting.

Overcoming Decades of Financial Isolation

Venezuela has been largely cut off from international financial institutions for years. The IMF has not completed a formal economic assessment of the country since 2004, and Venezuela paid off its last World Bank loan in 2007 under the late Hugo Chavez.

Current U.S. sanctions have been a major impediment to restructuring the country's complex $150 billion debt, as they prohibit international banks from dealing with the Venezuelan government without a license.

In a related move, President Donald Trump signed an executive order on Friday to safeguard Venezuelan oil revenues held in U.S. Treasury accounts. The order blocks courts or creditors from seizing these funds, stating they should be used to help create "peace, prosperity and stability" in Venezuela.

A source familiar with internal discussions at the World Bank said the lender is in the early stages of exploring how it can assist, noting its rapid support for countries like Afghanistan and Syria after regime changes.

Who Will Re-Enter Venezuela's Oil Sector?

Bessent expressed confidence that smaller, privately held companies would be the first to re-enter Venezuela's oil sector. "I think it's going to be the typical progression where the private companies can move quickly and will come in very quickly," he said, noting they have not raised financing concerns.

While some major oil companies like Exxon Mobil remain hesitant due to past nationalizations of their assets, Bessent believes others will expand their presence. "Chevron has been there a long time and will continue to be there, so I believe that their commitment will greatly increase," he stated.

He also echoed comments from U.S. Energy Secretary Chris Wright, suggesting a role for the U.S. Export-Import Bank in guaranteeing financing for the recovering oil sector.