** 8/26/26 - Reuters - Advisers launch committee in push to organize Venezuela commercial creditors + 5/15/26 -Publicdebtispublic - Green Light, Red Tape: Barriers to Venezuela’s Debt Restructuring
Buzz Sawyer
Advisers launch committee in push to organize Venezuela commercial creditors
By Katherine Shen, Sovereign Debt Forum Fellow, Head of Research #PublicDebtIsPublic | May 15, 2026
On May 5, 2026, the U.S. Treasury issued General License 58, which allows Venezuela to hire advisors to restructure its debts and those of its state agencies and instrumentalities, including the oil company, Petróleos de Venezuela (PDVSA). The move was modest in scope—it stops far short of authorizing a debt settlement or payment transfers—but the signal was unmistakable. On May 13, Venezuela’s interim government announced it had formally launched the restructuring process.[1] For the first time since 2017, one of the world’s largest unresolved sovereign defaults[2] may be headed for resolution with a green light from the U.S. government.
Positive signals notwithstanding, serious roadblocks to restructuring remain. Venezuela owes approximately US$150-200 billion to creditors around the world: this includes roughly US$92 billion in defaulted sovereign, PDVSA, and electrical utility bonds,[3] over US$20 billion in arbitral awards,[4] bilateral loans whose full extent remains undisclosed, and interest on the above liabilities that has been compounding for nearly a decade. Although Venezuela is a resource-rich middle-income country, international sanctions cut off its access to global capital markets years ago and pushed its borrowing toward risky and opaque structures, including resource-backed loans more typical of low-income countries. Credible restructuring negotiations will require knowing, with precision, who holds what claims, on what legal terms, and in what priority. On all three counts, the answers remain elusive.
The Legibility Problem
The sheer variety of debt instruments issued by Venezuela and its entities is extraordinary. There are sovereign bonds governed by New York law, PDVSA bonds secured by its subsidiary’s stock, bilateral loan agreements with China and Russia structured as prepayment for oil deliveries, arbitral awards won by expropriated multinationals at ICSID, the ICC, and the PCA, plus promissory notes, credit agreements, and judgments scattered across courts in Delaware, New York, Washington D.C., England, Portugal, the Netherlands, and more. Each instrument carries its own covenants and conditions, express or implied priority, governing law, and enforcement mechanism.
The #PublicDebtIsPublic research team has spent the past several months mapping this landscape, collecting and cross-referencing primary source documents for money claims against Venezuela going back to 1990. The exercise has been illuminating, not only for what documents we found, but for how difficult it has been to find them.
All the documents we have collected are, in a technical sense, public—we do not publish paywalled or private information. However, there is a significant gap between a document that is theoretically available and one that is practically accessible and intelligible. Information about claims and claimants on Venezuela is extremely difficult to piece together in a coherent and understandable way. Documents are published across different government agencies, regulatory and investigative media websites, and stock exchanges in multiple jurisdictions. Certain key contracts surface only when lawsuits force them into court filings. Arbitral awards—of which there are many, and in significant amounts—are routinely omitted from sovereign debt inventories. Bilateral loan agreements, including those with China and Russia, require multilingual detective work to surface.
Venezuela is not an outlier. It is a case study in near-universal failure: partial, inconsistent, convoluted, and fragmented sovereign debt disclosure. Opacity is the unstated norm.
In our experience building the #PublicDebtIsPublic platform, publication practices vary widely. Bond terms may be published on stock exchange, regulator, and borrower websites. Non-bonded debt disclosure is often borrower-driven and heavily influenced by borrowers’ domestic legal requirements.[5] Parliaments and other accountability institutions play important roles. Venezuela has fallen short of this transparency standard (among others) for decades.[6]
Bilateral official creditors, commercial banks, and state-owned entities rarely publish debt contracts, at least not voluntarily.[7] Older multilateral development banks with broad-based global membership are the notable exception: the World Bank, for instance, routinely publishes its general terms and conditions and specific loan terms. Many other multilateral, regional, and plurilateral institutions do not. For instance, CAF – the Development Bank of Latin America and the Caribbean (formerly the Andean Development Corporation)[8] has been an important lender to Venezuela, but does not publish its general conditions or specific contracts, forcing researchers to reconstruct its lending template from several dozen contracts published by other borrowing governments. In a fragmented information system where transparency is the exception rather than the rule, restructuring negotiations pose a challenge even for the most well-resourced and well-intentioned participants, and a far bigger challenge for public oversight.
The CITGO Question
No single feature of Venezuela’s debt stock illustrates its complexity more vividly than CITGO Petroleum, a Houston-based refiner and PDVSA subsidiary that sits at the center of a cascading series of enforcement actions in the U.S. courts.
Figure 1: PDVSA-CITGO Chain of Corporate Ownership and 2020 Notes Collateral Arrangement
See: U.S. District Court, SDNY, October 16, 2020, 495 F. Supp. 3d 257, pp.3 to 5.
CITGO is simultaneously a major U.S. energy asset—the fifth largest oil refiner in the United States—and the primary vehicle for creditor enforcement against Venezuela in U.S. courts. A key legal development came in 2018, when Crystallex, a Canadian mining company holding a US$1.2 billion ICSID award against Venezuela for the expropriation of a gold deposit, obtained a landmark ruling that brought PDVSA’s U.S. assets within reach of the government’s creditors. By ruling that the state-owned oil company is Venezuela’s alter ego,[9] the court cleared the way for creditors holding judgments against Venezuela to seize PDVSA’s shares in PDV Holding, CITGO’s parent company. The broader implication of the ruling is that a state-owned enterprise’s assets can become the vehicle for sovereign debt enforcement, and a state-owned enterprise’s debt becomes a sovereign’s debt. A queue of creditors quickly formed as a result: OI European Group, Tidewater, Valores Mundiales, and others together pursued over $20 billion in claims against CITGO, whose assets are estimated to be worth US$13 billion.[10]
Figure 2: Waterfall of Judgment Creditors Enforcing Against PDV Holding shares
Priority Order and Estimated Claims
Collateralization compounds the complexity. Before the U.S. federal court issued its alter egodecision, PDVSA had pledged 50.1% of CITGO Holding as security in a debt restructuring. This meant that unsecured judgment creditors of Venezuela were lining up to seize the very same shares that had been pledged to a group of PDVSA’s secured creditors: the holders of its 2020 Notes. Litigation over the validity of that pledge turned on a threshold choice-of-law question: whether New York or Venezuelan law governed the CITGO security arrangement and its consequences. The highest court in the State of New York held in February 2024 that Venezuelan law applied;[11] then on remand, the U.S. federal court found the bonds valid under Venezuelan law, and issued a US$2 billion judgment in favor of the secured PDVSA bondholders, which is now pending appeal before the Second Circuit.[12] Nonetheless, the judgment in favor of the PDVSA bondholders seems to set them on a collision course with Venezuela’s judgment creditors and others trying to seize the same CITGO shares.[13]
In November 2025, the Delaware district court tasked with mediating that contest approved a roughly US$8 billion bid for PDV Holding by Amber Energy, an affiliate of Elliott Investment Management, in a forced sale to satisfy creditors.[14] The sale remains on hold pending U.S. Treasury approval and the Delaware court’s decision is also on appeal before the Third Circuit.[15]
The problem illustrated by the litigation around CITGO is severe and straightforward: a single creditor’s attempt to enforce its claim triggers a scramble among claimants for finite and over-encumbered assets. There is no bankruptcy court to short-circuit the scramble.
Bilateral Creditors: China and Russia
When sanctions cut Venezuela off from international bond markets, official bilateral and state-owned bank loans became an important lifeline, with their customary mix of policy and economic objectives. China and Russia reportedly have some of the biggest claims in a potential restructuring of Venezuela’s sovereign debt, even though the amount and terms of their loans remain opaque. For instance, the China Development Bank (CDB) has extended a three-tranche loan totaling US$18 billion to Venezuela,[16] structured so that oil sale proceeds flow directly into collection accounts controlled by the lender.[17] The arrangement includes the Sino-Venezuela Joint Financing Fund, which operates through a layered architecture of commercial agreements sitting beneath the intergovernmental framework. To capitalize and grow this fund, China and Venezuela entered into the following agreements:
- A Framework Agreement among the China Development Bank (CDB), China National United Oil Corporation (CHINAOIL), Banco de Desarrollo Económico y Social de Venezuela (BANDES), PDVSA Petróleo S.A (PDVSA Petróleo), Fondo de Desarrollo Nacional S.A. (FONDEN), and Venezuela’s Ministries of Finance and Energy to increase the Sino-Venezuela Joint Fund through a US$2 billion contribution by FONDEN and a term loan facility of up to US$4 billion loan from CDB to BANDES;[18]
- A Four Party Agreement among BANDES, PDVSA Petróleo, CHINAOIL, and CDB, coordinating their interlocking obligations. It requires CHINAOIL to pay all sale proceeds generated under the Petroleum Sales and Purchase Contract into a collection account held at CDB, not to PDVSA Petróleo. CDB then applies the amount in that account against BANDES’ repayment obligations under the facility agreement relating to the US$4 billion loan. However, BANDES’ repayment obligation to CDB is absolute and independent of the oil proceeds.
- A Petroleum Sales and Purchase Contract under which PDVSA Petróleo commits to delivering 230,000 barrels of fuel and/or crude oil per day to CHINAOIL, with all proceeds irrevocably directed to CDB’s collection account; and
- An Account Management Agreement governing the operation of CDB’s collection account and the strict withdrawal restrictions that protect CDB’s repayment stream.[19]
If the structure itself were not complex enough, it turns out that the agreements at its foundation are governed by the laws of at least three jurisdictions, with at least two different dispute resolution mechanisms (Fig. 3). The Framework Agreement, Four Party Agreement, and Petroleum Sales and Purchase Contract are subject to UNCITRAL arbitration administered by the Singapore International Arbitration Centre (SIAC). The Framework Agreement and Four Party Agreement are governed by English law and the Petroleum Sales and Purchase Contract is governed by Venezuelan law. The Account Management Agreement is governed by Chinese law with disputes resolved by the China International Economic and Trade Arbitration Commission (CIETAC) in Beijing.
Figure 3: Governing Law and Dispute Resolution in Venezuela’s Oil-backed CDB Loans
Such jurisdictional fragmentation compounds the restructuring challenge: unwinding the oil-for-loan repayment mechanism would require renegotiating not just the sovereign intergovernmental framework but a web of independent commercial contracts binding Venezuela and Venezuelan entities, as well as their Chinese counterparties under different legal regimes, before different arbitral tribunals.
Russia has similarly used complex structures in its bilateral financing for Venezuela. For instance, a US$4 billion state credit, extended at 7.4% beginning in late 2011, apparently implicated a mix of arms sales and oil investments. The loan document (coming soon to the #PublicDebtIsPublic platform) references additional cooperation agreements and jointly owned financial institutions based in Moscow. It does not specify governing law or dispute resolution procedures, apart from amicable consultation.
These and other bilateral loans matter enormously for restructuring design and countries’ aspirations for debt sustainability. Bringing creditors with access to the borrowing country’s foreign currency revenues into the restructuring perimeter is very hard, all else equal. Convincing Russia and China to join a comprehensive collective restructuring process so visibly driven by Washington, may be harder still. Opacity surrounding bilateral loans destroys trust, already in short supply on both sides of the lending relationship, and stands in the way of inter-creditor equity and its squishier cousin, the Paris Club’s principle of comparability of treatment across creditor groups.[20] More complexity and more legal interventions are likely to come.
It bears emphasis in this context that the sanctions, licenses, and asset protection measures shaping Venezuela’s debt talks are more narrowly tailored than similar measures that had shaped Iraq’s debt settlement following the ouster of Saddam Hussein.[21] Residents of certain countries such as China are excluded from the licenses;[22] meanwhile, asset protection extends only to those Venezuelan hydrocarbon proceeds held by or paid to the United States.[23] The net result so far is to give the United States considerable leverage in the coming negotiations between Venezuela and its creditors.
What Happens Next
The issuance of GL58 is an early precursor to restructuring, with a long way to go before its start. Venezuela will need to hire advisors, assess the full scope of its debt, establish a negotiating framework, and work through competing claims from bondholders, bilateral lenders, arbitral award-holders, oil companies, and a long queue of judgment creditors. That process cannot begin in earnest until there is a more complete picture of what Venezuela owes, to whom, on what terms, and in what priority.
That picture does not currently exist. Venezuela has not completed an IMF Article IV consultation since 2004—though on April 16, 2026, the IMF announced the resumption of dealings with Venezuela.[24] Beyond the absence of macroeconomic data, the underlying debt instruments are scattered across jurisdictions, partially disclosed, or simply never published.
Iraq’s experience is instructive: like Venezuela, Iraq emerged from an era of sanctions without a current IMF assessment, and its creditor universe was similarly complicated, as the line between its government obligations and state-owned enterprises was blurred. It took Ernst & Young and Citigroup more than a year to develop a workable picture of Iraq’s debt stock.[25] Until the #PublicDebtIsPublic experiment, no centralized public repository of the source documents for Venezuela’s debt existed at all. The Venezuelan Debt Documentation page we built demonstrates how consolidating publicly available transaction documents in one place enables more comprehensive review, surfaces connections between instruments, and illuminates their implications. None of this is possible when contracts remain scattered across jurisdictions and buried in court filings, which is why the page remains a live document: our multilingual collection and analysis effort—in English, Spanish, Portuguese, French, and Russian—is ongoing.
In sum, Venezuela’s debt stock is complicated, but far from unique or uniquely opaque. To the contrary, it is unusual in that its debt stock is so visible, so well-litigated, and so consequential that it is forcing the world to confront the obvious: that a credible sovereign debt restructuring requires more than numbers and haircuts, but legal infrastructure, information infrastructure, and political will. Without a complete picture of who holds what claims, on what terms, and in what priority, any exchange offer or negotiated restructuring risks being legally infirm: priority analyses become contested, intercreditor equity claims multiply, and the debtor cannot make the robust disclosures that a lawful and durable settlement requires.
The stakes of transparency extend beyond any single restructuring. When the terms of public borrowing are accessible to all, citizens, legislators, and oversight bodies can hold governments accountable for the obligations incurred in their name—a prerequisite for meaningful democratic control over public finance, and for ensuring that the costs of sovereign debt are not simply passed on to future generations in the dark.
The #PublicDebtIsPublic platform, a Sovereign Debt Forum initiative hosted at Georgetown Law, maintains a living database of primary source documentation for claims against Venezuela at https://publicdebtispublic.mdi.georgetown.edu/wp/resources/venezuela-debt-documentation-agreements-awards-and-judgments/.