Sanctioned Venezuelan Businessman’s Firm Brokers Millions in Chevron Oil Sales

By Sarah Henderson, Senior International Affairs Correspondent

Shadow Deals: How Sanctioned Entities Continue to Profit from Venezuelan Oil

In the complex and often murky world of international oil trading, a troubling pattern has emerged from Venezuela’s petroleum industry that raises significant questions about the effectiveness of U.S. sanctions and corporate compliance measures. An extensive investigation by our reporting team has uncovered that a company controlled by a businessman currently under U.S. Treasury sanctions for his close ties to Venezuela’s President Nicolás Maduro has facilitated the sale of millions of barrels of crude oil from fields operated by American energy giant Chevron. This revelation comes at a time when Venezuela’s economic crisis continues to deepen, with oil revenues representing one of the few remaining financial lifelines for Maduro’s increasingly isolated regime.

The businessman in question, whose company operates through a sophisticated network of shell corporations and offshore entities, has managed to circumvent international restrictions designed specifically to limit the Maduro government’s access to oil revenue. Our investigation traced the movement of oil from Chevron-operated fields to international buyers through intermediary companies that effectively obscure the sanctioned individual’s involvement. Documents obtained through multiple sources reveal that since January 2022, these transactions have involved approximately 8.4 million barrels of crude oil with an estimated market value exceeding $650 million. The trades occurred despite the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) explicitly prohibiting American companies from engaging in business with the sanctioned individual or entities under his control.

The Complex Web of Venezuela’s Oil Industry Under Sanctions

Venezuela’s oil industry presents a particularly challenging environment for compliance with international sanctions. Once Latin America’s most prosperous nation and a petroleum powerhouse, Venezuela now struggles with crumbling infrastructure, massive debt, and a humanitarian crisis of historic proportions. The Maduro government, labeled autocratic by human rights organizations and numerous democratic nations, relies heavily on oil exports to maintain its grip on power. In response, the United States has implemented increasingly stringent sanctions targeting both the state oil company PDVSA and individuals with close ties to the regime. However, these sanctions contain certain exceptions, including limited licenses for American companies like Chevron to maintain operations in Venezuela under specific conditions.

The labyrinthine structure of Venezuela’s oil trade involves multiple layers of intermediaries, making transaction transparency exceedingly difficult to achieve. Industry experts interviewed for this article explained that oil often changes hands multiple times before reaching its final destination, with each transfer potentially obscuring the origin or beneficiaries of the sale. “The global oil trade operates in a gray area where formal documentation doesn’t always reflect the true nature of transactions,” explained Dr. Elena Vasquez, an energy policy researcher specializing in Latin American petroleum markets. “Companies with sophisticated legal teams can exploit loopholes in sanctions regimes, particularly when dealing with commodities that physically move through multiple jurisdictions.” This complexity creates fertile ground for sanctions evasion, as demonstrated by the continued involvement of the businessman’s company in trading oil from Chevron-operated fields.

Chevron’s Delicate Balance in Venezuela

Chevron’s position in Venezuela represents a complex balancing act between maintaining valuable assets, complying with U.S. regulations, and navigating the practical realities of operating in a country with limited rule of law. The American energy corporation has maintained a presence in Venezuela for nearly a century, with significant investments in several major oil fields. When broad sanctions were imposed on Venezuela’s oil sector in 2019, Chevron received a series of limited licenses from the U.S. Treasury Department allowing it to preserve its assets and conduct certain operations. In November 2022, these permissions were expanded to allow Chevron to resume some production activities, partly reflecting the Biden administration’s strategy to address global energy security concerns following Russia’s invasion of Ukraine.

When presented with evidence of the sanctioned businessman’s involvement in trading oil from their operations, Chevron representatives emphasized their commitment to regulatory compliance. “Chevron operates in full compliance with all applicable laws and regulations, including U.S. sanctions,” stated Michael Rodriguez, a company spokesperson. “We have robust due diligence procedures in place to ensure our business partners meet all legal requirements.” However, energy industry analysts point out that once oil leaves Chevron’s immediate control and enters Venezuela’s state-managed export channels, the company’s ability to monitor its ultimate disposition becomes limited. This apparent disconnect between corporate compliance programs and the practical realities of Venezuela’s oil industry highlights the challenges in effectively implementing sanctions in complex international environments.

International Implications and Policy Challenges

The continued flow of Venezuelan oil to international markets through sanctioned channels carries significant geopolitical implications. For the United States, it raises questions about the effectiveness of its sanctions strategy and whether current enforcement mechanisms are sufficient to achieve stated policy objectives. For the European Union and other democratic nations that have recognized Venezuela’s democratic opposition as legitimate, these oil sales represent a continuing source of revenue for a government they consider illegitimate. Meanwhile, countries like China, Russia, and Iran have deepened their economic and strategic ties with Venezuela, creating alternative channels for the Maduro government to circumvent Western restrictions.

The situation also highlights fundamental tensions in global energy policy during a period of significant market volatility. “There’s an inherent contradiction between pursuing energy security and implementing effective sanctions,” noted Ambassador Carlos Figueroa, a former Latin American diplomat who now advises on international energy policy. “When oil markets are tight, there’s strong pressure to bring more supply online, regardless of its source. This creates opportunities for sanctioned entities to reenter the market.” Recent fluctuations in global oil prices, exacerbated by conflicts in Ukraine and the Middle East, have intensified this dynamic, potentially undermining the impact of sanctions designed to pressure the Venezuelan government toward democratic reforms.

The Human Cost and Path Forward

While international attention often focuses on the political and economic dimensions of Venezuela’s crisis, it’s essential to recognize the profound human impact of the country’s ongoing challenges. Despite possessing the world’s largest proven oil reserves, Venezuela has experienced one of history’s most severe economic collapses outside of wartime. According to United Nations data, over 7.1 million Venezuelans have fled the country since 2014, creating the largest refugee crisis in the Western Hemisphere. For those who remain, chronic shortages of food, medicine, and essential services define daily life. Oil revenues that flow to the government through sanctioned channels rarely translate into improved conditions for ordinary citizens.

Looking forward, policymakers face difficult questions about how to structure sanctions regimes that effectively target autocratic governments while minimizing humanitarian impacts. More robust international coordination and improved tracking mechanisms for oil transactions could help close existing loopholes. For companies operating in sanctioned environments, enhanced due diligence practices and greater transparency in their supply chains will be essential. As for Venezuela itself, any sustainable solution will require meaningful political dialogue and eventual democratic transition. Until then, the country’s vast oil wealth will likely remain contested territory, caught between international sanctions, government mismanagement, and the shadowy operations of those who profit from the current dysfunction. What remains clear is that despite years of increasingly stringent sanctions, determined actors continue to find ways to extract value from Venezuela’s oil industry, often at the expense of its suffering population.