By Marianna Parraga and Matt Spetalnick

HOUSTON/WASHINGTON – A proposal is being considered by the Biden administration. Chevron According to four sources close to the discussion, Corp (NYSE:), proposed to let the U.S.-based oil major accept and trade Venezuelan crude oil cargoes as a way to repay unpaid debt.

According to two people, Chevron representatives have held several high-level meetings with U.S diplomats and Venezuelan opposition envoys in the last few months. The meeting was described as an important milestone in the year-long campaign by Chevron to obtain a modification to its Venezuelan license.

According to two Washington sources, there was no agreement and no timetable.

Chevron is asking Washington for the reinstatement of trading privileges that it had previously enjoyed under President Donald Trump. To recoup dividends from state-owned oil company PDVSA, the company was allowed to export Venezuelan crude oil along with other foreign producers.

This arrangement, which allowed Chevron 1 to 2 Million barrels of Venezuelan crude oil per month until mid 2020, was ended under Trump’s “maximum Pressure” campaign.

Although the strategy had a significant impact on Venezuela’s oil exports, it has not been able to stop oil revenues from reaching Venezuelan President Nicolas Maduro. This allows for an export rebound.

According to one person who was familiar with the discussions, “The Biden administration is more motivated than Trump to relax sanctions on Venezuela.” One source said that Maduro is one of the most important.

Chevron, which is the U.S.’s only major oil producer with personnel in Venezuela, owes the Venezuelan government hundreds of million of dollars.

Chevron spokesperson Ray Fohr stated that it is “a common practice to meet U.S. government officials in order to provide perspectives on Energy Issues Important to the Company”. He was responding to questions regarding the company’s lobbying.

Chevron has “committed the safety and well-being of our employees, their families, the integrity our joint venture assets and the company’s social and human programs,” he said.

The U.S. Treasury Department did not comment. According to a spokesperson from the U.S. State Department, sanctions “do not preempt” any actions. According to the spokesperson, sanctions “deny Maduro regime income streams that finance repression. They also line the pockets regime officials.

Venezuela’s Oil Ministry and PDVSA have not responded to inquiries for comment.

POLITICAL HURDLES

Some oil cargoes could be allowed to travel under U.S. sanctions, which might signal flexibility towards Venezuela. A top oil company could be allowed to move under U.S. sanctions, which would boost U.S. job opportunities. However, a Republican backlash is unlikely, according to one person.

Biden’s administration has also been trying to find ways to get Maduro back to negotiations with Venezuelan opposition. These talks would not involve making major concessions to his government.

Juan Guaido of Venezuela’s opposition, who repeatedly calls for the restarting of political negotiations with Maduro following their suspension in October, said last month that a U.S. offer not to lift sanctions should talks resume but was “not indefinite” and could be reversed.

Chevron’s new deal could help improve relations with India. India was once one of the most important recipients of Venezuelan crude oil from U.S.-authorized refineries.

Some advisers, however, are cautious about any move that might undermine tough Venezuela sanctions. These concerns include Florida where there is a large Cuban and Venezuelan exile community.

Others have stated that they would not ease the major punitive actions unless Maduro takes steps towards democratic elections.

NO OIL FOR THE FUEL

People said that even if Chevron does not agree to modify its license terms, the United States could still allow an exemption from the U.S. Treasury’s Office of Foreign Assets Control’s (OFAC), restrictions to allow oil exports.

Since 2019, most Venezuelan trades have been conducted through oil for fuel swaps. These agreements ensured Venezuelan crude was not resold and that Maduro’s government would receive no cash payments.

Biden officials are strongly against swaps or any other agreements that might benefit PDVSA through supplying the fuels and diluents it needs to increase its oil exports.

Sources say that Chevron and other European oil companies have also called Washington for Venezuelan oil trade.

According to one person, “If Chevron’s license is reworked that will have a cascade impact on other companies’ lobbying.”