The events of January 2026 have fundamentally redrawn the relationship between Washington and Caracas.

On January 3, US special forces abducted President Nicolás Maduro in Caracas to face federal drug trafficking charges in New York with many believing that Venezuela’s leadership negotiated this outcome.

Vice President Delcy Rodríguez was swiftly sworn in as interim president, and within weeks, a transformed Venezuela is emerging, one that has dismantled the statist oil policies of the Chávez era and aligned its hydrocarbons sector with US strategic interests. For more context please check out my prior articles on the matter:

• “Calls For Venezuelans To Resist US Attack Even As Maduro’s Whereabouts Are Unknown”
• “Why Venezuela’s Military Did Not Fight”
• “If Venezuela’s Oil Industry Could Be Easily Revived As Trump Thinks China Would Have Already Done It”
• “Russia’s UN Envoy Says Betrayal Enabled US Attack To Kidnap Venezuela’s Maduro”

Click here to read this article in Spanish/Español.

This is not a conventional diplomatic coming together, but more of a victor’s peace applied to the western hemisphere’s largest proven oil reserves.

The term “detente” implies a mutual relaxation of tensions which inadequately captures this arrangement. What has emerged could be better characterized as a forced detente or coerced trusteeship, where one party dictates most the terms of economic integration following decisive military intervention. The Rodríguez government has secured temporary survival and the prospect of desperately needed revenue flows. US oil companies gain access to the world’s largest proven reserves under a favorable legal framework. But these benefits flow within a structure that cedes core elements of Venezuelan sovereignty, legal jurisdiction over energy contracts, fiscal control over oil revenues, and operational oversight of the nation’s dominant industry.

The centerpiece of this new order is the landmark reform to Venezuela’s Hydrocarbons Law, approved by the National Assembly on January 29, 2026. The legislation marks an abrupt reversal of two decades of state-controlled energy policy, fundamentally reopening the upstream sector to private participation while preserving formal state ownership of subsoil resources. This addresses the longstanding investor complaint that PDVSA’s control over marketing and cash flows rendered joint ventures commercially untenable. Under the reformed framework, private companies may now operate through two primary structures: traditional joint ventures where the state retains majority ownership, or newly codified “Productive Participation Contracts” that allow private firms to assume full operational and financial responsibility for upstream activities at their own risk. This breaks from the previous mandate requiring PDVSA to hold a minimum 60 percent stake in all projects.

Following the reform of the Organic Hydrocarbons Law approved in late January 2026, Venezuela has formalized a new model of Productive Participation Contracts that grants greater operational and financial autonomy to private partners. Under this scheme, and within the framework of licensing flexibility, agreements have been ratified or negotiated with multinational companies such as Chevron, Repsol, Eni, Maurel & Prom, BP, and Shell, which can now manage the marketing and cash flow of their projects independently of PDVSA. Currently, the Ministry of Petroleum and PDVSA are in the process of reviewing and adjusting 26 joint venture contracts to align them with the new fiscal and regulatory conditions of the reform, which include royalty reductions and income tax benefits.

On the same day the Hydrocarbons Law was approved, the US Treasury Department’s Office of Foreign Assets Control issued a series of expanded authorizations that collectively sketch a tightly supervised pathway for US engagement. General License 46A authorizes established US entities to engage in transactions related to Venezuelan-origin oil.

Subsequent licenses expanded further with, the US Department of the Treasury, through OFAC, issued new General Licenses — Nos. 46, 47, 48, 49, and 50 — in January and February 2026, significantly easing restrictions on the energy sector. GL 47 permits the export of US-origin diluents critical for processing heavy crude; GL 48 authorizes the provision of goods and services for operations; and GL 49 allows companies to negotiate contingent contracts for new upstream investment, subject to separate OFAC approval. Five major international oil companies, BP, Chevron, Eni, Repsol, and Shell, have received broader authorization under GL 50 to expand operations without case-by-case OFAC review.

These authorizations allow US and allied entities to conduct transactions for the export, refining, transport, and marketing of Venezuelan-origin crude and gas, as well as the purchase of specialized equipment and vessel chartering. Furthermore, prohibitions on the secondary trading of certain bonds have been removed, and port and airport operations necessary for investment have been facilitated, provided that payments are channeled through US-supervised mechanisms, such as Foreign Government Deposit Funds.

Fiscal terms have been substantially recalibrated. Royalties are capped at 30 percent, with flexibility to reduce rates as low as 15 percent for specific high-investment projects. The previous 33.3 percent extraction tax has been replaced with a new hydrocarbons tax capped at 15 percent of annual gross revenues, and certain windfall taxes have been eliminated entirely. Critically, the reform authorizes international arbitration for dispute resolution, removing the prior requirement that all conflicts be settled exclusively in Venezuelan courts. Perhaps most significantly, private companies may now directly market their share of production and manage revenues through foreign accounts something unseen in Venezuela for over two decades.

Yet for all the commercial opportunity, the legal architecture imposes extraordinary conditions that effectively subordinate Venezuela’s oil sector to US oversight. Any contract with the Venezuelan government or PDVSA must be expressly governed by US law and subject to dispute resolution in the United States. This requirement removes the Venezuelan legal system from any role in adjudicating disputes involving its most valuable natural resources. Even more striking is the financial control mechanism. All payments due to the Venezuelan government or PDVSA must be routed into accounts designated by the US Treasury Department. The practical effect is that oil revenues are deposited in US-controlled accounts reportedly in Qatar to be released only for approved purposes such as public services. This arrangement transforms the Venezuelan state from a sovereign resource owner to a beneficiary under US fiscal supervision. The licenses also impose detailed reporting obligations, requiring comprehensive information on parties, quantities, values, and destination countries.

Transactions involving Chinese, Russian, Iranian, North Korean, or Cuban entities are strictly prohibited.

The US-Venezuela detente represents a regime tweak that achieves long-standing US objectives such as dismantling the PDVSA monopoly, opening the sector to Western capital, and securing energy supplies, in a “less is more” fashion, without the costs of full-scale occupation. The Chavista institutional facade remains, but its economic content has been fundamentally rewritten under duress. For now, a structure of coercive oversight preserves Venezuelan institutions while subordinating their substance to US control in exchange for the dropping of sanctions.

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Miguel Santos García is a Puerto Rican writer and political analyst who mainly writes about the geopolitics of neocolonial conflicts and Hybrid Wars within the 4th Industrial Revolution, the ongoing New Cold War and the transition towards multipolarity. Visit his blog here. 

He is a Research Associate of the Centre for Research on Globalization (CRG). 

Featured image is from the author

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