The United States on Wednesday issued a general license broadly authorizing U.S. companies to do business with Venezuela’s state-run oil company PDVSA, a move that could unlock new investment and eventually increase the country’s crude production capacity, Reuters said. 

The action by the Treasury Department’s sanctions arm, OFAC, does not lift all sanctions on PDVSA, which have been in place since 2019, but it marks a significant easing of restrictions as Washington seeks to support higher oil supply, the news agency said. The license follows a late-January legal reform that gave PDVSA’s partners greater autonomy to operate oilfields, export crude, and receive proceeds, prompting negotiations over new contracts and project expansions.

The waiver does not authorize transactions involving Venezuelan bonds, nor transfers of equity in PDVSA’s U.S. subsidiaries including PDV Holding, Citgo Holding, and Citgo Petroleum, the news agency noted. Treasury also said a specific license would still be required before any sale in the Delaware court case involving PDV Holding could be executed.

The authorization further excludes dealings with U.S.-sanctioned companies and with Chinese, Russian, Iranian, Cuban or North Korean firms, as well as transactions deemed not commercially reasonable, including swaps, payments in kind, or digital currency, Reuters reported.

Venezuela has recently been exporting oil near top capacity, mainly through partner Chevron and trading houses Vitol and Trafigura. March exports are forecast at about 900,000 barrels per day, roughly pre-blockade levels, according to ship-tracking data cited by Reuters. Production earlier this month was about 1.05 million barrels per day, up from 878,000 barrels per day in early January.

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