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Chevron Corp may be on the verge of getting US approval to expand its oil operations in Venezuela, possibly by the end of this week, according to reports.

Approval hinges on whether talks resume between the Venezuelan government led by socialist President Nicolas Maduro and the country’s opposition.

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US officials have offered some easing of sanctions and released some Venezuelan prisoners held in US prisons.

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The Biden administration’s proposal for Venezuela comes amid signs of slowing production in US shale as well as Russian oil shrinking under sanctions and OPEC+ production cuts by Saudi Arabia.

Thanksgiving gas prices hit record highs but Americans are still on the road

To curb rising energy prices this year, President Biden has released more than 200 million barrels from the nation’s emergency oil reserves, though they are due to expire soon.

Chevron’s current license to operate in Venezuela expires on December 1. Should it not receive approval to expand operations earlier, the US could renew its existing licence, allowing the oil giant to retain its assets without expansion, sources familiar with the matter told Reuters. .

Amaui Refinery Complex

Chevron holds a joint venture with PDVSA, Venezuela’s state oil company, which produced about 200,000 barrels per day before US sanctions and a lack of funding curtailed production.

US officials and their Venezuelan counterparts are pushing to hold talks in Mexico City later this week – the first in more than a year.

Venezuela produces a maximum of 800,000 barrels of oil per day. This figure is above average 525,000 barrels It produced a year earlier, but far from its failed target of 1 million per day by the end of 2021 and nowhere near the 3 million barrels per day the country produced in the 1990s.

Venezuelan oil is also heavy and dirty and more suitable for making asphalt and petrochemicals than being used for cars. Extracting gasoline and diesel from Venezuelan oil would require a complex refining process.

The country also lacks quality engineers, as many of those who drove Venezuelan industry at its peak were exiled from the country during the Hugo Chávez era, when the socialist dictator nationalized the Venezuelan oil industry.

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Fox Business has contacted Chevron and the US Treasury Department for comment.

A spokesperson for the National Security Council (NSC) told Fox Business that the US “recognizes that we must support the Venezuelan people and their democratic aspirations.”

The spokesman added that any action would depend on the relevant parties returning to dialogue and announcing other specific commitments to support the Venezuelan people.

“There will be no announcements or actions in response to energy prices, as we have said in the past, it is about the regime taking the necessary steps to support the restoration of democracy in Venezuela,” the spokesman said.