Venezuela’s interim President Delcy Rodriguez has signed into law a reform bill that will pave the way for increased privatisation in the South American country’s nationalised oil sector, fulfilling a key demand from her United States counterpart, Donald Trump.
On Thursday, Rodriguez held a signing ceremony with a group of state oil workers. She hailed the reform as a positive step for Venezuela’s economy.
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“We’re talking about the future. We are talking about the country that we are going to give to our children,” Rodriguez said.
The ceremony came within hours of the National Assembly – dominated by members of Rodriguez’s United Socialist Party – passing the reform.
“Only good things will come after the suffering,” said Jorge Rodriguez, the assembly’s head and brother of the interim president.
Since the US military’s abduction of Venezuela’s former leader Nicolas Maduro and his wife Cilia Flores on January 3, the Trump administration has sought to pressure President Rodriguez to open the country’s oil sector to outside investment.
Trump has even warned that Rodriguez could “pay a very big price, probably bigger than Maduro”, should she fail to comply with his demands.
Thursday’s legislation will give private firms control over the sale and production of Venezuelan oil.
It would also require legal disputes to be resolved outside of Venezuelan courts, a change long sought by foreign companies, who argue that the judicial system in the country is dominated by the ruling socialist party.
The bill would also cap royalties collected by the government at 30 percent.
While Rodriguez signed the reform law, the Trump administration simultaneously announced it would loosen some sanctions restricting the sale of Venezuelan oil.
The Department of the Treasury said it would allow limited transactions by the country’s government and the state oil company PDVSA that were “necessary to the lifting, exportation, reexportation, sale, resale, supply, storage, marketing, purchase, delivery, or transportation of Venezuelan-origin oil, including the refining of such oil, by an established US entity”.
Previously, all of Venezuela’s oil sector was subject to sweeping US sanctions imposed in 2019, under Trump’s first term as president.
Thursday’s suite of changes is designed to make Venezuela’s oil market more appealing to outside petroleum firms, many of whom remain wary of investing in the country.
Under Maduro, Venezuela experienced waves of political repression and economic instability, and much of his government remains intact, though Maduro himself is currently awaiting trial in a New York prison.
His abduction resulted in dozens of deaths, and critics have accused the US of violating Venezuelan sovereignty.
Venezuela nationalised its oil sector in the 1970s, and in 2007, Maduro’s predecessor, Hugo Chavez, pushed the government to increase its control and expropriate foreign-held assets.
Following Maduro’s abduction, Trump administration officials have said that the US will decide to whom and under what conditions Venezuelan oil is sold, with proceeds deposited into a US-controlled bank account.
Concerns about the legality of such measures or the sovereignty of Venezuela have been waved aside by Trump and his allies, who previously asserted that Venezuelan oil should “belong” to the US.
