The government of Venezuela has initiated a formal restructuring of its sovereign debt and obligations linked to state oil company Petróleos de Venezuela (PDVSA).
It represents the first structured attempt to resolve a default that has been in place since 2017.
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The government indicated that restructuring terms would be grounded in a debt sustainability analysis aimed at justifying “meaningful debt relief,” and pledged “open, continuous, and proactive engagement” with creditors.
Total liabilities are estimated at over $150bn across multiple reports, with some figures reaching $170bn when wider obligations are factored in.
Officials attributed Venezuela’s inability to service its international financial obligations to sanctions in force since 2017, as well as external pressures, including the commodity price collapse and the COVID-19 pandemic.
“Restoring public debt sustainability is central to this agenda,” the government said, adding that the existing debt burden “constrains external financing, limits public investment capacity, and prevents full re-engagement with the international financial system”.
The exercise will encompass all external public sector liabilities, including commercial eurobonds issued by both the republic and PDVSA, handled through a single unified process.
Four guiding principles were set out: sustainability, comprehensiveness, transparency and speed.
Venezuela expects to present its macroeconomic framework and debt sustainability analysis to the international financial community in June 2026.
Investment bank Centerview Partners has been appointed as financial adviser for the restructuring.
The move follows recent authorisation by the US government permitting Venezuela to engage legal, financial and consulting firms in connection with a potential restructuring of its sovereign and PDVSA debt.
Separately, Chevron last month signed an asset exchange agreement with PDVSA, expanding its footprint in Venezuela’s heavy oil sector.
The deal raises Chevron’s working interest in the Petroindependencia joint venture by 13.21 percentage points to a total of 49%.
The Petropiar joint venture, in which Chevron holds a 30% stake, has also been granted development rights over the adjacent Ayacucho 8 area in the Orinoco Oil Belt.
