PDVSA

PDVSA (Petróleos de Venezuela, S.A.) is the state-owned oil company of Venezuela, founded in 1976 following nationalisation of the country's petroleum industry. It controls the Orinoco Belt, home to the world's largest proven crude reserves, making Venezuela a tier-one producer at full capacity. Decades of mismanagement, corruption and US sanctions have reduced output from 3.5 million Barrels Per Day in 1998 to under 800,000 today. The company is wholly state-owned and headquartered in Caracas; its export revenues are central to the Maduro government's fiscal survival.

With the Strait of Hormuz closed after Iran-US escalation, the Trump administration issued a broad Treasury authorisation for PDVSA to sell oil on global markets, routing payments through a US-controlled account. The measure was one of two supply-side interventions designed to cap spiralling energy costs, though analysts noted it could not offset the scale of the Hormuz disruption. The authorisation illustrates a recurring tension: Washington treats PDVSA as a pressure valve during supply crises while keeping the Maduro government under broader economic siege.

The 18 March 2026 PDVSA authorisation included an explicit carve-out blocking sales to Cuba, Russia, Iran, North Korea, and certain Chinese entities. A 25 March follow-up licence permitted Venezuelan crude sales to Cuban private-sector buyers only, while the Cuban state and GAESA remained blocked. The combined effect is that Cuban state fuel-import infrastructure is cut off from Venezuelan crude entirely, leaving Russia as the sole active resupply source.

On 13 May 2026 the dominant Cuba framing inverted: Energy Minister Vicente de la O Levy told Mesa Redonda that Venezuelan crude shipments had been interrupted since November 2025, four months before the 18 March authorisation previously framed as the proximate cause. The 18 March order ratified a flow PDVSA had already stopped. Possible upstream causes (none confirmed publicly) include PDVSA operational degradation, Cuban inability to pay in convertible currency, or redeployment of PDVSA shadow-fleet Chinese tankers to Asian Brent buyers as Hormuz disruption widened the spread. OFAC's General Licence 134B (18 April 2026) then extended the window for Russian crude already loaded for Cuba through 16 May 2026, confirming Russia had fully replaced Venezuela as Cuba's active supplier.