View of the Amuay Refinery in Falcón state, Venezuela. Photo: Andrea Hernández.
By Betzabeth Aldana Vivas – Jan 30, 2026
On January 29, after a decade of near-total prohibitions on the involvement of US companies in Venezuela’s oil sector, the US Treasury Department’s Office of Foreign Assets Control (OFAC) issued General License (GL) No. 46 under the regulatory framework of the Venezuela Sanctions Regulations (31 CFR Part 591).
This measure entails a carefully calibrated administrative review that adjusts the existing regulatory framework and redefines the conditions under which US participation in Venezuelan oil operations is permitted.
It is a broad-scope license that authorizes, under specific conditions, transactions that were previously prohibited, covering almost the entire value chain of the sector: from crude oil extraction and lifting to its export, refining, marketing, transportation, and associated logistics services.
The authorization includes the export, re-export, sale, resale, supply, storage, purchase, delivery, and transportation of Venezuelan oil, as well as the refining of such oil.
We use the word “almost” because the new exemption does not mention primary activities, such as production, in line with the partial reform of the Organic Law of Hydrocarbons, since production remains under the control of the Venezuelan State, either directly through wholly state-owned companies, or through subsidiaries or joint ventures.
In essence, the core of this administrative reengineering prioritizes established US entities, making them the linchpin around which the new authorization is developed, with a vast focus on hydrocarbon commercialization.
After years in which various US governments, by political decision, chose to withdraw from the Venezuelan oil business and limit the participation of US companies in the sector under a sanctions regime, this license establishes a framework in which those companies can once again participate in accordance with regulations, without altering Venezuelan state control over primary production.
Established US entities
One of the central elements of this license is the reference to “established US entities,” a concept that precisely defines who may benefit from the authorization.
According to the interpretive note included in the license itself (Note 1 to paragraph (a)), an established US entity means “any entity organized under the laws of the United States or any jurisdiction within the United States on or before January 29, 2025.”
This definition directly includes US oil and energy companies, as well as other legal entities incorporated in the United States that engage in activities ordinarily incidental and necessary for oil operations, such as maritime transport, insurance, logistics, port services, and terminals.
In fact, foreign companies are allowed to apply for authorization if they legally establish an entity or subsidiary in the United States.
This new scheme represents a substantial modification to the previous license management regime.
Before the issuance of General License No. 46, oil companies, especially US ones, had to apply to OFAC for specific licenses to carry out any activity related to Venezuelan oil, which entailed case-by-case processes, limited authorizations, and a high degree of administrative discretion.
With this general license, an ex ante authorization is established that allows US oil companies, in their entirety, to re-enter the Venezuelan oil business without having to obtain individual authorizations.
The license also introduces contractual requirements that reinforce US jurisdiction over the operations authorized to its companies.
Therefore, the license stipulates that every contract entered into with the Venezuelan government or PDVSA must expressly stipulate that it is governed by US law and that any dispute resolution mechanism will be carried out within US territory.
While the reform of the Organic Law of Hydrocarbons stipulates that contracts related to regulated activities may provide for dispute resolution mechanisms through Venezuelan courts or alternative means such as arbitration and mediation, in the case of US companies operating under GL 46, any dispute arising from their operations must be resolved in accordance with US law and within its jurisdiction.
In this framework, the Venezuelan Ministry of Hydrocarbons could, as appropriate, coordinate the inclusion of these clauses in the contracts, ensuring that both Venezuelan law and the terms of the license are respected, thereby guaranteeing the legal certainty of the parties and compliance with OFAC requirements.
On the other hand, since these are US companies, a surgical relief is introduced in one of the most critical bottlenecks of the Venezuelan oil trade: maritime insurance and P&I services. Amid the sanctions onslaught, these had been a real thorn in the side for crude oil shipments. By expressly authorizing the contracting of charters, maritime insurance, logistics, and port services, the license restores the link connecting Venezuelan oil to the traditional market.
The payments
In financial matters, General License No. 46 establishes a specific framework for handling payments to blockaded persons.
Such payments must be channeled through the “Foreign Government Deposit Funds,” a legal and technical concept defined in Executive Order 14373, or through any other account expressly designated by the Treasury Department.
This mechanism does not involve unblocking assets. Rather, it allows funds to remain under US regulatory oversight.
Similarly, the license leaves open the possibility that, in the future, other funds or accounts may be designated for use, which must be administered through the Treasury Department.
The license also authorizes commercially reasonable payments through crude oil, diluent, or refined product swaps, provided they comply with standard market practices.
At the same time, the license expressly prohibits debt swaps, gold payments, and transactions denominated in digital currencies.
This means that all transactions must be settled in US dollars, reaffirming a structural principle of US financial policy: ensuring that the region’s strategic energy continues to circulate in the global reserve currency.
In this way, the license allows US companies to resume access to Venezuelan oil without compromising the central role of the petrodollar in international transactions.
Geopolitical and trade logic
A central element of General License No. 46 is the precise delineation of the actors excluded from the authorized scheme.
Paragraph (b) operates as a legal and geopolitical cordon sanitaire, since it does not list prohibited oil activities for the companies but rather identifies modalities, actors, and corporate structures that remain off-limits, even under the new framework of flexibility.
First, the license absolutely excludes any transaction on the traditional market that involves, directly or indirectly, individuals or entities linked to Russia, Iran, North Korea, or Cuba, as well as corporate structures controlled by them or established in partnership with these actors.
This exclusion is due both to their status as strategic adversaries of the United States and to the fact that they are all subject to comprehensive sanctions regimes imposed by OFAC.
In these cases, the prohibition operates automatically, based solely on the jurisdiction of the party involved, almost as if it were determined by their nationality, regardless of the legal form of the transaction or its commercial design. Any connection, direct or indirect, with this group of countries is sufficient for the transaction to be excluded.
By contrast, the treatment of China follows a substantially different logic, since it is not a jurisdiction subject to comprehensive US sanctions.
OFAC does not impose a general prohibition based on Chinese nationality, nor does it exclude China as a potential market or final destination for Venezuelan crude oil commercialized by the US companies.
Paragraph (b) prohibits the corporate structure of the entity seeking to use the license and does not automatically identify all Chinese companies or the Chinese market as the final destination.
Thus, the license design intends to prevent Chinese actors from obtaining direct benefits within the license regime, without completely closing off the possibility of Venezuelan oil reaching the Chinese market through commercial channels outside the licensed framework, since the exemption includes broad authorizations, such as resale, re-export, and other successive commercial steps that introduce a degree of flexibility.
It should be noted that the explicit inclusion of practices such as resale and re-export, for example, opens a controlled loophole allowing Venezuelan crude to circulate beyond the initial buyer, even to third countries, albeit under a traceability and ex post oversight framework materialized in the obligation for the US oil companies to submit detailed reports to the State Department and the Department of Energy.
In certain scenarios, this would allow the indirect participation of private Chinese actors in the energy sector, provided that such participation occurs outside the Venezuelan or US entities covered by the license, without involving control, ownership, or any prohibited corporate association.
In other words, the exemption appears to allow these secondary transactions, but not in the gray market. Rather, it can be within a monitored framework that reintegrates Venezuelan oil into the traditional commercial circuit.
Venezuela’s National Assembly Unanimously Approves Hydrocarbons Law Reform
The key is being turned: administration of licenses
This new administrative maneuver in no way constitutes a lifting of sanctions.
The legal framework underpinning the sanctions regime against Venezuela remains intact, as the Venezuela Defense of Human Rights and Civil Society Act of 2014 and its successive extensions have not been repealed—something that is also politically unlikely, since the United States typically does not repeal such framework laws but rather administers them, reinterprets them, or overlays them with executive instruments.
Similarly, the executive orders declaring a “national emergency” with respect to Venezuela (and the new one of January 9) remain in effect. They form the direct legal basis upon which the Venezuela Sanctions Regulations (31 CFR Part 591) are built.
In other words, the parent legal framework has not been dismantled.
In that regard, it is appropriate to mention that the Sanctions Regulations derive from an act of Congress and presidential executive orders, and it is within that framework that the Treasury, through OFAC, deploys its administrative licensing mechanism.
General License No. 46 should therefore be read as a tool for administering the sanctions regime, not as a reversal of it.
It is a technical-political adjustment that allows certain operations without touching the legal core that enables the sanctions.
Now, within the broad catalog of general and specific licenses that Washington has issued, suspended, or modified in recent years, this license introduces a relevant nuance: it fully maintains the punitive nature of the scheme, but selectively eases its application at this stage, especially at the operational and commercial levels.
The system is made more flexible under strict conditions, with clear geopolitical exclusions, reinforced financial controls, and reporting mechanisms that preserve the US government’s monitoring and enforcement capabilities.
What is distinctive is that, while retaining that restrictive character, the license grants an unusually broad operational scope for certain oil activities, particularly for US companies that the US government itself had de facto expelled from the Venezuelan market under the sanctions umbrella.
Thus, rather than a dismantling of the measures, what is observed is a functional recalibration.
Finally, amid a complex geopolitical landscape, the Venezuelan government has carefully pieced together the elements within the sanctions regime, preserving control over the resource and primary activities, expanding operational capacity, and ensuring the continuity of public policies that benefit the country.
The strategy demonstrates skillful management of room for maneuver, as well as the ability to maintain essential operations and ensure that Venezuelan crude continues to flow, even in the context of historically severe international restrictions.
At the same time, it is clear that the United States’ strategic interest has always revolved around Venezuelan oil.
On the part of the Venezuelan government, trade and engagement channels were never completely closed. Rather, the sanctions policy itself imposed limits that are now being modified by General License No. 46.
Indeed, this shift in the sanctions regime tacitly reflects the gradual return of the United States to the Venezuelan oil business, a market it has considered strategic since time immemorial.
Translation: Orinoco Tribune
OT/SC/SF
