Caracas (AFP) – Venezuelan lawmakers on Thursday began debating plans to throw open the country’s lucrative oil sector to private investors, paving the way for the return of US energy majors as pushed by President Donald Trump. The draft bill, seen by AFP, ends decades of state control over Venezuela’s biggest industry by allowing “private companies domiciled in the Bolivarian Republic of Venezuela” to engage independently in oil exploration and extraction. It comes less than three weeks after the US ouster of socialist strongman Nicolas Maduro, whose predecessor and mentor Hugo Chavez forced the nationalisation of foreign-owned oil companies in the mid-2000s.
The bill has been promoted by Maduro’s former deputy, acting leader Delcy Rodriguez, who has presided over a lightning-fast thaw in US ties. In a sign of the speed of the changes unfolding in Caracas, Washington named a new head for its mission in Venezuela. The US embassy page listed Laura F. Dogu — a former ambassador to Nicaragua and Honduras — as the new charge d’affaires to Venezuela, in what was seen as another step on the road to the restoration of full diplomatic ties.
– Warming relations –
Caracas and Washington severed ties after Maduro’s widely disputed claim to reelection in 2019, and the US embassy has been mostly deserted since then, barring a few local employees. Within days of Maduro’s capture in Caracas, US diplomats visited the city to discuss reopening the embassy. Trump has said he was working “really well” with Rodriguez, who was vice president in Maduro’s rabidly anti-US government. On Wednesday, a US official said Rodriguez would visit the United States soon.
Maduro was toppled on January 3 after a months-long US pressure campaign and flown to New York with his wife to face trial on drug trafficking charges. Trump claims Washington now effectively runs Venezuela and controls its oil industry. Rodriguez has appeared ready to comply so far.
– Dollar influx –
This week, she ploughed $300 million from a US-brokered oil sale into propping up the ailing national currency, the bolivar. The mere anticipation of the injection drove down the price of dollars, the currency in which many Venezuelans conduct their business. But economists warned that true relief from spiralling prices would require a sustained influx of dollars — which in turn requires foreign investment. Venezuela has the world’s largest proven reserves of oil.
Legislation liberalizing the sector is expected to sail through parliament, where Rodriguez’s socialists have a majority. It ends a two-decade-old requirement for private companies to form joint ventures with state-owned oil firm PDVSA, which insisted on holding a majority. “This completely changes the landscape,” Dolores Dobarro, former vice minister of petroleum and an expert in oil legislation, told AFP. The law also makes the royalties regime more flexible, based on the success of the oil exploration project.
Rodriguez was petroleum minister under Maduro — a position she still holds. To win the support of both Venezuelans and Washington, she needs to quickly show improvements in the economy and also signal an end to a decade of worsening repression under Maduro. In the past two weeks, her government has released dozens of political prisoners from among the hundreds behind bars. On Thursday, authorities released the son-in-law of opposition figure Edmundo Gonzalez Urrutia, who was serving a 30-year sentence on terrorism charges.
Tudares was arrested in January 2025 while on his way to school with his two children. Gonzalez Urrutia, in exile in Spain, is widely considered the rightful winner of Venezuela’s 2024 presidential election, which Maduro claimed to win. Since Maduro’s ouster, Trump has ramped up pressure on another Latin American arch-foe, communist Cuba. He has vowed to cut off all oil supplies to the island, which has relied for years on heavily-subsidized Venezuelan oil and cash to remain afloat. Cuban President Miguel Diaz-Canel said Thursday he spoke by telephone with Rodriguez and expressed Havana’s “support and solidarity.”
© 2024 AFP
