"Chevron Corp ( NYSE:CVX) is negotiating with the Trump administration to expand its Venezuela oil license, aiming to boost exports to 300,000 barrels per day by March. The move comes as Trump pivots toward energy independence policies, creating a strategic opening for Chevron to capitalize on discounted Venezuelan heavy crude. The stock has responded enthusiastically. Chevron surged 12.3% year-to-date through January 29, hitting a 52-week high of $174.92 earlier this week."
"Here's the business logic: Venezuelan heavy crude trades at steep discounts to benchmark WTI, which currently hovers around $60 per barrel. Chevron's refining infrastructure is optimized for heavy crude processing, giving it a margin advantage competitors can't easily replicate. With oil prices stabilizing after an 18% decline from early 2025 peaks, the economics work at current levels but leave little room for error."
Chevron is negotiating with the Trump administration to expand a Venezuela oil license to export 300,000 barrels per day by March, aiming to capitalize on discounted heavy crude. The stock rose 12.3% year-to-date and reached a 52-week high of $174.92, outpacing the Energy Select Sector SPDR Fund. Venezuelan heavy crude trades at steep discounts to WTI near $60 per barrel, and Chevron's refineries are optimized for heavy crude, providing a margin advantage. Oil prices stabilized after an 18% decline from early 2025 peaks, but economics are sensitive to WTI falling below $55. The company is negotiating Lukoil's Iraqi assets and selling Singapore refining operations while streamlining its portfolio and adding low-cost production where geopolitics allow.
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