PDVSA joint ventures profitability

Navigating Venezuela post Chevron is fascinating: China is our largest oil buyer, it imported 428,000 barrels per day in April 2025 and seeks to expand its influence. China has historically supported Venezuela through loans and investments, securing oil supplies at discounted rates and strengthening bilateral ties. Vice President Delcy Rodriguez met CNPC executives in May 2025 to discuss new investments, signaling China's intent to play a more active role with Chevron's exit. China could manage joint ventures with PDVSA, leveraging its experience in navigating sanctions, to secure a stable oil supply. China's potential to fill Chevron's void is supported by its economic leverage and sanctions evasion expertise. 

Shadow tanker fleets and gray market channels allow China to bypass United States restrictions, ensuring continued access to Venezuelan crude. Challenges include United States secondary tariffs, with a 25% levy imposed on Venezuela's clients. Despite these hostilities, China's demand for discounted oil and strategic interests make it a likely candidate for operational expansion. Geopolitically, China's growing role enhances its influence in Latin America, countering United States interests. Securing Venezuelan oil aligns with Venezuela's energy security goals, as it diversifies supply sources. This shift strengthens China's position in global oil markets, reshaping regional power dynamics. 

Compared to Russia and Iran, China is better positioned, due to its economic strength and capacity to absorb large oil volumes. Russia's focus on Ukraine and Iran's sanctions limit their roles, making China the most profitable to fill the operational vacuum led by Chevron. Russia has historical ties with Venezuela, with Russia building minority stakes in Pdvsa ventures, enhancing sanctions evasion since the 2000s. The partnership has helped Venezuela redirect oil exports to Asia during past United States sanctions, with several sectors. Russia could expand by taking over operations or providing technical support, leveraging to experience in sanctioned environments.

Rosneft's prior involvement in Venezuela, including managing joint ventures position it to potentially fill some of the operational gaps left by Chevron. Russia's current role is limited by its focus on the Ukraine conflict and its sanctions, reducing its capacity for significant operational involvement. United States sanctions on both nations further complicates direct investments, forcing Russia to rely on intermediaries to engage with Venezuela's oil sector. Competition with China for Asian markets, as highlighted by the internal energy administration, constrains Russia's role. Both nations target China for oil exports, but China's economic leverage gives it an edge. 

Russia's logistical difficulties under sanctions also hinder the ability to expand operations in Venezuela. Geopolitically Russia's involvement strengthens ties with allied regions. Countering United States influence in Latin America, access to Venezuelan oil provides strategic advantages, enhancing Russia's global energy presence. However, commitments elsewhere limits the extent of its engagement in Venezuela's oil industry. Russia's role remains secondary to China's, with Iran's involvement also limited by sanctions. While Russia can offer technical support and sanctions evasion expertise, its operational expansion is unlikely to match China's, given current priorities and competitive dynamics of the global oil market.

Iran has supplied dilluent to Venezuela, providing 35 million barrels of condensate from 2021 to 2023, critical for exporting heavy crude. The support enables PDVSA to dilute its extra heavy oil, ensuring it can be transported and sold internationally. Iran facilitates clandestine trade through shadow tanker fleets, strengthening ties with PDVSA. These fleets help Venezuela evade United States sanctions, recounting crude to markets like China. Iran's expertise in sanctions evasion, homed by its own experience, enhances this partnership with several exits. Iran could deepen its involvement by providing technical support or expanding logistics assistance. Its experience in heavy crude processing could help PDVSA improve refining capabilities, potentially mitigating some of the production challenges faced after losing Chevron's expertise.

Iran's own sanctions and competition with Venezuela for Chinese markets limit its operational role. Both nations compete for discounted oil sales to China. Iran's domestic priorities and regional conflicts constrain its ability to invest heavily in Venezuela. Geopolitically, Iran's involvement strengthens cooperation between sanctioned nations, creating a block resistant to Western pressure. This partnership risks further international isolation, but provides mutual economic benefits, ensuring both countries can sustain oil exports despite United States sanctions and global market challenges. Compared to China and Russia, Iran's role is supportive, focusing on logistics and diluent supply rather than direct operations. China's economic strength and Russia's historical ties give them an edge, while Iran's contributions remain critical but secondary in Venezuela's post Chevron oil landscape.

United States sanctions have pushed Venezuela toward China, Russia and Iran, ceding influence to these adversaries. From 2018 to 2022 sanctions benefited China's refiners, Iran's trade and Russia's investments, reshaping Venezuela's geopolitical alliances. Chevron's CEO Mike Wirth, in a Fox Business report on May 4th 2025, cautioned that China, Russia and Iran could fill the vacuum left by Chevron's exit. His warning enhances the regional influence countering United States interests, strengthening foothold in Latin America's oil sector. Economic decline from reduced oil exports has deepened Venezuela's reliance on non-western partners: China's imports of 428,000 barrels per day and Iran's diluent supply highlights the trend. 

Sanctions have inadvertently created opportunities for these nations to expand challenging United States dominance in the region. Security concerns such as the government's claim of thwarting sixty attacks on oil facilities are seen as propaganda. Social media posts label these claims as a pretext for repression, illustrating how the government exploits crisis to maintain power. Public frustration underscores the geopolitical states. The opposition's disunity, with abstensionists called virtual terrorists, weakens resistance to the government, allowing non-western powers to gain influence without significant domestic opposition. Geopolitical implications highlight the unintended consequences of United States sanctions, which have not only failed to dislodge Maduro but have also strengthened United States adversaries. This shift poses long-term challenges for United States foreign policy in Latin America, as Venezuela's oil industry becomes a battleground for global influence.

Abstensionists are labeled as virtual terrorists for boycotting elections, reflecting deep divisions within Venezuela's opposition. This boycott aimed at denying the government's legitimacy prevents the opposition from occupying seats in the national assembly and governorships. Veppex, a diaspora organization, criticized opposition leaders like Manuel Rosales for negotiating with the government. These negotiations are viewed as legitimizing a government responsible for thousands political prisoners, undermining the opposition's moral stance. The call for a unified opposition by Veppex highlights the government's human rights abuses, including torture and disappearances. The diaspora's push for unity aims to strengthen resistance against the Venezuelan government. Internal divisions between abstentionists and participationists hinder a cohesive strategy to challenge the government proposals, to resume debates on revoking the nationality of exiles boycotting elections. Government's influence over political discourse exploits opposition disunity, proposing punitive actions that further alienate the diaspora.

María Corina Machado is blamed for the socialist landslide. She is accused of deliberately destroying opposition unity. Her actions, seen as divisive, have weakened the opposition's ability to counter the government, allowing socialists to gain ground in recent elections. Political tensions exacerbate economic challenges. The opposition is unable to address the crisis following Chevron's exit. Government exploits these divisions using repression and propaganda to maintain power, while the opposition's disunity leaves Venezuelans without effective representation or solutions. Diosdado Cabello's claim of thwarting sixty attacks on oil facilities aims to portray the government as a protector of national interests. This narrative suggests external threats to justify heightened security measures, and maintain control over the oil sector. These claims are labeled as propaganda by the opposition, arguing the government uses fabricated threats to justify repression. The lack of evidence for these attacks fuels skepticism, with many believing the narrative targets opposition leaders to criminalize dissent.

The government's focus on security threats, real or fabricated, targets figures like Juan Pablo Guanipa. Accusations of forging Guanipa's handwriting to stage a setup reflect the government's tactics to discredit opposition voices, intensifying political repression, This narrative distracts from economic failures, as oil exports dropped 20% in April 2025 following Chevron's exit, by framing opposition as responsible for attacks. The government shifts blame for declining production, avoiding accountability for mismanagement and the impact of United States sanctions on the oil industry. Public skepticism highlights distrust in the government's motives. Security threats are probably a lie to justify repression, reflecting a broader sentiment that the government exploits crisis to maintain power further, eroding its legitimacy among Venezuelans. Propaganda tactics underscore the government's efforts to clang to power, amid economical and political crisis. By leveraging security concerns, Nicolás Maduro diverts attention from the oil sector's decline, but growing public discontent and opposition criticism suggest these strategies may not sustain the government's grip long term.

We advocate for Latin American integration to eliminate borders, fostering a regional sphere of influence. This vision seeks to unite nations like Venezuela, Guyana and the rest of the Caribbean, countering the dominance of large territorial powers through collective economic and political strength. Historical disputes with Cuba and Guyana have motivated Venezuelans to learn about these sister cultures. The Guayana Esequiba conflict, escalating with attacks on Guyana patrols on May 15 2025, highlights tensions but also the potential for dialogue and cultural exchange. To foster unity integration is seen as a counter to large powers like the United States, with Venezuela's oil industry challenges underscoring the need for regional support. Collaborative efforts could stabilize economies, share resources and address crises like Venezuela's, but political divisions within the region pose significant barriers to achieving this goal. 

Shared energy initiatives could help, but opposition disunity hinders Venezuela's ability to lead or participate effectively in integration efforts, stunting potential progress. Cuba's role in regional integration is highlighted in its diplomatic relations with Guyana since 1972. Venezuela could learn from this, using cultural ties to bridge disputes, but the government's focus on repression over diplomacy limits its capacity to engage constructively with neighbors. The potential for integration to address economic crisis exists, but political divisions remain a barrier. Venezuela's internal strife and external conflicts with Guyana must be resolved, to realize a unified Latin American sphere capable of tackling shared challenges, like oil dependency. United States sanctions since 2019 have targeted PDVSA to pressure the Venezuelan government, culminating in Chevron's exit on May 27th 2025. These measures aimed to weaken the government, but have significantly disrupted Venezuela's oil industry, reducing production and export capabilities.

Secondary tariffs including a 25% levy on Venezuelan oil buyers were introduced in March 2025, per the White House. This severely reduced export volumes. The revenue loss limits Venezuela's ability to fund essential imports and services. The economic decline from reduced exports has deepened Venezuela's humanitarian crisis with limited funds for food, medicine and social programs. Inflation and poverty rates have soared, threatening social stability. Potential gasoline shortages exacerbate daily hardships for Venezuelans. Even with sanctions the United States imported 149,000 barrels per day from Venezuela the week of May 23rd 2025, down from 250,000 barrels per day in January. This pre- Chevron exit flow underscore sanctions partial effectiveness, but post May 27 cessation pushes Venezuela toward China, Russia, and Iran. 

Sanctions have driven Venezuela toward nonwestern partners, with China importing 428,000 barrels per day and Iran supplying diluent. This shift reduces United States influence, as Venezuela pivots its allies who can navigate sanctions, reshaping its international alliances. Public frustration criticizes both the regime and opposition for failing to address economic woes. Sanctions have strengthened United States adversaries like China and Russia, who fill the void left by Western companies. The unintended consequence destabilizes Venezuela further as the government leverages these partnerships to survive challenging United States foreign policy goals in the region. Conoco Phillips registered a $10 billion arbitration award in Trinidad and Tobago on May 28th 2025, targeting PDVSA assets as reported by Stabroek News. This legal action stems from Venezuela's 2017 nationalization of Conoco Phillips's assets posing a significant threat to PDVSA's financial stability and ability to operate internationally. The award could lead to asset seizures, further straining PDVSA's operations, with exports already down 20% in April 2025 losing key assets like tankers or overseas accounts would disrupt crude sales exacerbating Venezuela's economic crisis and limiting funds for imports and debt repayment. 

Pdvsa needs to address inefficiencies and invest in infrastructure. Modernizing upgraders and improving transparency could attract foreign partners, but the government's focus on control over reform, as seen in its repression tactics hinders progress, delaying necessary changes. Regional integration offers a path forward with collaboration potentially stabilizing Venezuela's economy. Learning from disputes with Cuba and Guyana could foster unity, but political divisions and the government's focus on control over diplomacy hinder progress delaying economic revitalization. International cooperation, regional integration, resolving internal divisions, and investing in the oil sector are critical to recovery, ensuring Venezuela can leverage its resources to rebuild and achieve long-term stability amidst ongoing challenges.