The communication strategies of Nicolás Maduro’s regime have shifted from a stance of “Venezuela has fixed itself” to promoting a “Chevron effect”, suggesting an economic recovery anchored in oil production and exportation. The following op-ed scrutinizes the validity and implications of the regime’s new narrative and highlights the importance of effectively using resources that will contribute to shape the future of Venezuela.

Economic Context: Recession and High Inflation

For 34 months, from January 2020 to November 2022, the Maduro regime sustained the illusion that “Venezuela has fixed itself”. However, the country’s actual economic situation, characterized by an annualized inflation of 439% in July 2023 and a recession marked by consecutive GDP decline over two quarters, paints a very different picture.

Chevron’s Role in the Venezuelan Economy

With the license granted by the Biden Administration to Chevron to resume oil extraction and exportation alongside Petróleos de Venezuela, S.A. (PDVSA), there has been a consistent rise in crude production and export. In July 2023, Chevron’s production accounted for 17% of Venezuela’s total production. In addition, Chevron played a more intricate role, helping the Central Bank of Venezuela inject dollars into the currency market to attempt to control the Bolivar’s devaluation.

The “Chevron Effect” and Maduro’s Politics

Maduro has sought to amplify the “Chevron Effect” narrative to support his argument that international sanctions on PDVSA have been the prime culprit for the economic downfall rather than internal mismanagement and the plundering of the state-owned oil company.

Geopolitical Implications and Political Future

Despite the surge in oil production, the economic activity needs to be sufficiently robust to offset the recession in the year’s first half. Concurrently, the pledges for an electoral resolution to the country’s political and economic crises remain unrealized under the stipulations of sanction relaxation on PDVSA by the Biden Administration.

The “Chevron Effect”, thus, emerges as a double-edged sword strategy: on one hand, it is a tool for the Maduro regime in seeking the easing of sanctions and enticing oil investments; and, on the other, it stands as a leverage point that the Biden Administration might employ to press for substantial political reforms in Venezuela.

Conclusion

The “Chevron Effect”, much like the preceding “Venezuela has fixed itself” narrative, faces an uncertain future if the Maduro regime does not commit to a genuine political resolution engaging all national and international stakeholders. The White House, in alliance with other democratic Western governments, holds the tools to influence the trajectory of democracy in Venezuela. The pressing question remains whether these tools will be effectively employed to chart a course that will create a more stable and prosperous future for the South American nation.

English