Comments on US policy toward Venezuela - May 2025
The Hawks vs the Transactionalists
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The Trump administration does not have a Venezuela strategy.
Donald Trump does not have a Venezuela strategy. He is influenced by those around him, especially by whoever he spoke to most recently. When asked, Trump wants everything: cheap oil, access to business deals, a place to deport Venezuelans, legal justifications for his agenda, an image of US toughness and winning, and support from US voters and politicians, particularly those based in Florida, who hate Maduro and want him gone. With no clear priority among these goals, there are two groups trying to influence his policies.
The Hawks: Marco Rubio and various members of Congress close to the Cuban and Venezuelan exile communities believe that harsher sanctions will cause economic pain that will force Maduro from power. The fact that strategy is not supported by historical evidence does not negate the fact that there is a certain logic to it. This pro-sanctions side has grown quite small in terms of the number of people who support it. Rubio pretty much stands alone inside the administration and far fewer members of Congress are on board with it than were a few years ago. But they have leverage. Rubio may stand alone, but he is probably the most powerful cabinet member at the moment, controlling the National Security Council and having the president’s ear on nearly all foreign policy issues. And those three GOP members of Congress are needed to pass any budget bill.
The Transactionalists: Representing the other side, Special Envoy Ric Grenell wants engagement with Maduro because it’s good for US businesses. Grenell is backed by various business interests including top GOP donor Harry Sargeant. He also has the support of others within the Trump coalition who want repayments of other Venezuelan debts, more deportations, a more isolationist agenda (in the sense of spending less US power outside our borders), or a stronger push against what they view as China’s encroachment in the Western Hemisphere. Those in favor of engagement and transactions with the Maduro regime have found a message that unifies them and that they believe resonates with the president: sanctions that restrict US businesses will give China greater influence in Venezuela. That big geopolitical narrative is a great framing for them and has become the big talking point, no matter the diverse other interests that are at play.
Last week saw the fight within the Trump administration over US policy in Venezuela go public.
Special Envoy Ric Grenell flew to Antigua, negotiated a 60 day extension of the Chevron license in return for Venezuela accepting more deportation flights and handing over a US Air Force veteran being held hostage by the Maduro regime. OFAC also dropped sanctions against a few corrupt Venezuelans who were involved in laundering regime profits.
Members of the Florida congressional delegation who want a harder line against Maduro protested and threatened to withhold their vote for Trump’s budget bill.
Secretary of State Marco Rubio announced on Twitter that the current Chevron license would end on 27 May (today). No new license has been announced yet, but the rumor published by Bloomberg over the weekend is that the US will end the current license and issue a more narrow license that allows Chevron to continue only minimal maintenance operations.
This could be spun as a win-win for both sides - Rubio gets to say the “Biden license” is over and Grenell gets to tell Maduro he kept his promise to get the license extension. Or it could be a lose-lose, with the hawks upset that Chevron clings on to its Venezuela assets while the pro-negotiation side loses credibility because Chevron cannot operate at the same level it did before.
A limited license for Chevron is dangerous for the hawks because, even if it looks like a win in the moment, it can be easily reversed once the budget is complete. Will Trump flip-flop on Venezuelan sanctions as soon as that budget vote is done? The president’s reputation in politics and business includes decades of deals where he burns the other party as soon as he sees an opportunity. Rubio and the Florida members of Congress know this about Trump, though they can never admit it publicly. So the Florida congressional reps, with Rubio’s help, know they have a very short window to push for permanent restrictions on Chevron that are far more difficult to undo.
This is important to understand the incentives of the two sides over the coming three months.
The hawks need a big win now that cannot be easily undone. Their side in Congress will begin to lose influence once the budget debate is over. Within the cabinet, while Rubio is powerful today, if his influence declines at any point, the other side gains.
The transactionalists are happy to hold on and cling to whatever small clump of influence they can, because their position is much more likely to win in the long run if they can get past the current moment where the hawks seem to have the edge.
Given these incentive structures, expect the hawks to go for a decisive kill as soon as possible. What does that mean?
Even if Chevron receives a limited license, Rubio or Congress may try to kill it before it gets another renewal.
There is a new debate in Congress over whether Russia should face new sanctions. The hawks will try to tie Venezuela in with Russia and Iran sanctions to make them more permanent and give the president less ability to reverse them without regime change in the country.
The hawks can expand the debate outside of Chevron and oil to go after the debt negotiations and the Citgo sale. The people who want oil sales and the people who want various debt payments are conveniently unified behind Grenell right now, but they can potentially be split in a way that weakens that side of the debate. Moving the Venezuela debate to include other finance sectors may be the most aggressive way for Rubio to approach this issue.
Rubio and the hawks have also discussed using the terrorist designation of TdA to target the Maduro regime in a way that supersedes the current sanctions debate. If anyone supporting Maduro is said to be working with a terrorist group, it makes the transactionlists much more vulnerable.
Also last week, while the internal U.S. debate raged, events inside Venezuela continued to deteriorate. A new wave of arrests targeted opposition leaders including Juan Pablo Guanipa. Those arrests occurred right before the government held regional elections where very few voters participated. Venezuela’s electoral authorities announced imaginary results showing the government had won nearly all the governorships and a super-majority in the legislature, but miscalculated the voter turnout percentages, helping to highlight the fact that they are outright rigging the elections. Venezuela also continued to push a narrative about owning a portion of Guyana, something that the rest of the world opposes. This sort of repression and electoral manipulation has led to additional sanctions in the past. It gives the hawks a small amount more of leverage in their debate this moment.
Amid this dispute, the online narrative turned ugly. Someone backing Rubio’s position leaked to US media that Grenell’s trip was not sanctioned by the president. Whether or not that was true, it undermined Grenell because it created a brief image of a president who wasn’t in charge of everything. They also leaked that Grenell’s trip was privately backed by Sargeant, which is not a surprise to anyone who follows the issue, but did raise questions about how the Grenell negotiations came about. Meanwhile, lobbying groups backing the transactionalist side continue pushing the China angle. They are also highlighting the role of the current budget debate. As with the leaks about the Grenell trip, these narratives about the budget fight attempt to portray the president as being manipulated by one side and therefore push him away from that group.
I mention these details because the lobbying on this issue is complex and taking place both online and in backrooms in DC. Part of the lobbying is largely aimed at one person: President Donald Trump. Influence the president to take a definitive side and the argument can be over. But there are also numerous smaller debates within the Congress and policy community. While the Trump administration can be divided into hawks vs transactionalists, there are other positions in this debate including within think tanks and in the Democratic Party that matter in the long term, even if they have very little influence this month.
Where does this go next? My prediction on the very first day of the Trump administration was the following:
Trump starts with a hardline policy demanding sanctions and regime change and then pivots to negotiations with Maduro later in his term…. Most noticeably, Trump will take action to limit or fully remove the Chevron license. However, though announced, that move on the license may not be implemented instantly. Even if oil companies are forced to scale back until the pivot, I would bet that Chevron is operating in Venezuela in January 2029.
While the weekly ups and downs of the fight between the two sides have been much more publicly rocky and confrontational than I predicted, the situation remains in line with that general prediction. The hawks are in the lead right now, but if they can’t achieve a decisive victory in the coming months, the transactionalists will hold on and the policy flip will happen.
I continue to think the transactionalists are more likely to win across the next three and a half years and a policy shift will happen part-way through the Trump administration. That said, Rubio is going to make a big push in the coming months to prevent that prediction from happening. This past week was just a taste of the fight to come. Policy uncertainty remains for the rest of this year. Revisit this prediction in Q1 or Q2 of 2026 and there will still not be a definitive victor in the battle of Hawks vs Transactionalists.
The wildcards in this debate are held by the actors outside the US. Much of what is written above rests on the assumption that Maduro is stable in power. Sectoral sanctions won’t push him out. However, his own incompetance or bad luck could. The low oil price environment can harm his government just as much as sanctions. While China is a willing and eager buyer and he continues receiving support from other allies including Russia and Iran, none of that is guaranteed in the future. Negotiations related to Ukraine, the Iranian nuclear program, or China-Taiwan all have potential impacts on the international support Maduro receives. Within his own neighborhood, it’s possible that Maduro finds himself facing less friendly governments in the coming years. Maduro’s own inner circle has not cracked, but there are always tensions that could emerge. And while everyone assumes that Maduro’s opposition will remain divided and unable to find a winning strategy, the fact Venezuela’s president is opposed by a super-majority of the population remains a key weakness.
In short, the status quo remaining in Venezuela is the most likely scenario, but it also rests of a lot of assumptions that could break apart quite suddenly. Regime change in Venezuela is an outlier scenario. It doesn’t occur due to the debate going on within the Trump administration. But it can’t be totally ruled out either. I’ll write more about that in the weeks ahead.
Thanks for reading.