The Trump administration announced on February 26 that it is ending Chevron’s permit to operate in oil-rich Venezuela, which will halt U.S. imports of Venezuelan crude by early April. These changes, combined with other recent developments, are likely to significantly impact complex U.S. Gulf Coast refiners relying on heavy crude. In today’s RBN blog, we’ll discuss these impacts — an issue our Refined Fuels Analytics (RFA) practice examined in its recently updated Future of Fuels report.
First, some background. Chevron and its corporate predecessors have more than a 100-year history of operations in Venezuela. Chevron’s legacy company, Venezuelan Gulf Oil, began drilling in 1924, spurring commercial oil production there, and followed that up with operations at Lake Maracaibo and the Boscan Field (tiny, pink-shaded area in Figure 1 below) in northwestern Venezuela. Then-President Carlos Andrés Pérez nationalized Venezuela’s oil industry in 1976 and established Petróleos de Venezuela S.A. (PDVSA) as the state-owned oil company, but despite the nationalization, Chevron remained, and it was asked to form joint ventures (JVs) with PDVSA. In 2006-07, then-President Hugo Chávez’s regime increased royalties and taxes on foreign oil companies and made other changes that prompted some companies — including ExxonMobil and ConocoPhillips — to leave Venezuela.
Figure 1. Venezuela’s Orinoco Belt and Boscan Field. Source: RBN
But Chevron hung on, attracted by Venezuela’s vast reserves and the ability to produce oil at low costs. By staying put, Chevron agreed to give up majority control of its operations to PDVSA. Still, it retained 40% interests and continued to be involved in several onshore and offshore projects, including Petroboscán in western Venezuela, while focusing on extra-heavy oil production in three blocks within the Carabobo area of the Orinoco Belt (blue-shaded area in Figure 1 above).
There have been other ups and downs for Chevron along the way, resulting in a mostly downward trend for Venezuelan crude exports to the U.S. in recent years (see Figure 2 below). For instance, the first Trump administration, in August 2017, imposed economic sanctions on Venezuela that resulted in lower oil production and reduced exports to the U.S. It followed that up in April 2020 by ordering Chevron to wind down its production in Venezuela, although the Biden administration later reversed the order. The Biden administration eased sanctions in October 2022 and allowed Chevron to increase production for sales to the U.S.
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About the song
“You Can't Always Get What You Want” was written by Mick Jagger and Keith Richards and appears as the fourth song on side two of The Rolling Stones’ eighth studio album, Let It Bleed. It was recorded in November 1968 at Olympic Sound Studios in London as part of the sessions for The Stones’ Beggars Banquet album but was held for release until the 1969 Let It Bleed album. It’s unusual in that it features producer Jimmy Miller on drums, not Stones drummer Charlie Watts. Al Kooper played keyboards on it and the French horn intro. The London Bach Choir (who asked that their name be removed from the album credits to no avail) was brought in to supplement the choruses at the end. A short version was released as the B-Side of the “Honky Tonk Women” single in July 1969. It ended up being re-released as an A-Side single in 1973 and going to #42 on the Billboard Hot 100 Singles chart. The song remains one of the most popular songs at Stones’ live concerts, with audiences singing along with the refrains. Personnel on the record were: Mick Jagger (lead vocals), Keith Richards (guitars), Bill Wyman (bass), Al Kooper (piano, organ, French horn), Jimmy Miller (drums), Rocky Dijon (congas, maracas, tambourine), Madeline Bell, Nanette Workman, Doris Troy (backing vocals), and the London Bach Choir, arranged by Jack Nitzsche (choral vocals).
Let It Bleed was recorded between November 1968 and November 1969 at Olympic Sound Studios in London and Elektra and Sunset Sound in Hollywood with Jimmy Miller producing. Released in November 1969, it went to #3 on the Billboard 200 Albums chart and has been certified 2X Platinum by the Recording Industry Association of America. Two singles were released from the LP.
The Rolling Stones are an English rock band formed in London in 1962. Mick Jagger and Keith Richards are the only remaining members of the original group. Past members include Brian Jones (died in July 1969), Charlie Watts (died in August 2021), Ian Stewart, Mick Taylor and Bill Wyman. Ronnie Wood joined the band as a permanent official member in 1975. Steve Jordan has been drumming for the group since Watts’s passing. The Rolling Stones have been active for over six decades and have sold over 250 million records worldwide. They have released 31 studio albums, 39 live albums, 25 compilation albums, three EPs and 122 singles and have received three Grammy Awards and a Grammy Lifetime Achievement Award. The Stones are members of the Rock and Roll Hall of Fame and the U.K. Music Hall of Fame. Their latest album, Hackney Diamonds, was released in October 2023. They continue to record and tour.
