The U.S. Treasury just gave Chevron Corp. a short 30-day eviction notice from Venezuela, cutting off its ability to pump and sell crude from the sanctioned country. The decision, following Trump’s vow to reverse Biden’s oil concessions to Nicolás Maduro and the cancellation of a sanction waiver just days ago, is a seismic shift that could slam both Venezuela’s already fragile economy and U.S. refiners relying on its heavy crude.

The standard wind-down period is 6 months, according to Bloomberg.

For Chevron, this is a hard stop after years of carefully maneuvering U.S. sanctions. The oil giant was responsible for about 20% of Venezuela’s total production, providing a rare source of economic stability and desperately needed hard currency. That revenue—estimated at $6 billion—was one of the few things keeping the country from total collapse.

The Biden administration had allowed Chevron to ship 240,000 barrels per day of Venezuelan crude to U.S. refineries, a lifeline for Gulf Coast refiners designed to handle heavier crude grades. But Trump’s crackdown means those barrels are off the table come April 3. Markets reacted immediately—Chevron shares fell 1.3%, while WTI crude slipped to $67.36 and Brent dropped to $70.24 as traders recalibrated expectations.

Florida Republicans have long argued that any U.S. dealings with Venezuela only prop up Maduro’s regime, calling for tougher measures. Trump echoed that sentiment, posting on social media that he was “reversing the concessions Crooked Joe Biden gave to Nicolás Maduro.” Secretary of State Marco Rubio piled on, vowing to “terminate all Biden-era oil and gas licenses that have shamefully bankrolled the illegitimate Maduro regime.”

Venezuela, unsurprisingly, is calling the move “harmful” and predicting it will cause “damage to the U.S., its people, and its companies.” Meanwhile, with Chevron gone, Venezuela may revert to shadowy oil deals with Iran and China—a return to the “ghost tanker” days of lost revenue and sanctions evasion.

The bigger question? Where will U.S. refiners turn for heavy crude now—and at what price?

By Julianne Geiger for Oilprice.com

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