The Venezuelan oil sector is facing near-collapse, reflecting the chronic under-performance, political interference, and funding challenges confronting state oil company PDVSA. The latest blow comes in the form of new U.S. sanctions, announced January 28, designed to help usher Nicolas Maduro out of the president’s office, and opposition leader (and U.S.-recognized interim president) Juan Guaido into it.

There is little if any prospect for stabilization if Maduro remains in office. But the possibility of a genuine political...