Guaido survival likely to buy more time for Chevron

The White House appears likely to extend a waiver for Chevron to operate in Venezuela after US-backed opposition leader Juan Guaido overcame a government-backed rival to retain control of the National Assembly.

Guaido, accompanied by allied deputies, pushed past heavy security surrounding the assembly this morning and was sworn in as the legislature's president for 2020, enabling him to maintain his Western-recognized status as Venezuela's interim president.

Government-backed deputy Luis Parra and his legislative allies were forced to flee the legislative chamber after the Guaido contingent burst in. Parra had claimed yesterday to have won an internal legislative election to replace Guaido as assembly president. His disputed election was recognized by Russia, Maduro's main foreign patron. But the US, EU and Canada denounced the Parra vote as fraudulent.

Today's chaotic developments are a setback for President Nicolas Maduro, who has so far withstood US financial and oil sanctions aimed at forcing him out of power in favor of Guaido, who declared his interim presidency in January 2019, based on his leadership of the assembly.

The assembly is widely seen as the last democratic institution remaining in Venezuela. All other state institutions are controlled by Maduro. But Guaido's political footing remains fragile, amid cracks in the opposition and corruption allegations that he has been accused of doing little to confront.

With Guaido tentatively still in action, the US Treasury seems likely to roll over a sanctions waiver for Chevron as well as a clutch of US oil services companies that expires on 22 January, nearly a year after Washington imposed oil sanctions on the Opec country.

Guaido-led opposition officials have indicated support for Chevron to remain in Venezuela, as they see the US major as a key future partner for the country's economic recovery under a post-Maduro government. US supporters of a waiver extension argue that Chevron's forced withdrawal would only open the door for deeper Russian and Chinese participation in the oil industry.

Chevron routinely declines comment on its Venezuelan operations and the status of its sanctions waiver. In October 2019, the company said it is a "constructive presence" in Venezuela.

One of Chevron's key assets in Venezuela is the PetroPiar extra-heavy crude production and upgrading joint venture with national oil company PdV.

PetroPiar's upgrader had been shifted into less complex blending mode last year, but a tentative industry recovery has enabled the plant to resume upgrading Orinoco extra-heavy crude into Hamaca synthetic crude for export.