President Trump Announces U.S Control of Venezuela Oil Reserves
U.S. of America President Donald Trump has announced a plan to give the U.S. of America majority control of more than 65 billion barrels of Venezuela’s proven oil reserves through partnerships with private companies.
He said the arrangement, which he said would cost U.S. taxpayers nothing, would help revive Venezuela’s struggling oil industry and boost crude supplies to U.S. refineries, potentially easing pressure on fuel prices.
“Under my leadership, Secretary of State Marco Rubio, and Secretary of War Pete Hegseth, working with Highly Respected Interim President of Venezuela, Delcy Rodriguez, and in conjunction with private business, have secured majority U.S. control of over 65 BILLION BARRELS of proven Oil Reserves in Venezuela, at no cost to the American Taxpayer,” President Trump posted on Truth Social.
Venezuela has the world’s largest proven oil reserves but is producing about 1.25 million barrels per day, well below its potential after years of underinvestment, mismanagement and U.S. sanctions.
Venezuelan interim leader Delcy Rodriguez welcomed the agreement, saying it will lead to more production and investment and more government revenue.
The plan would entail the development of 17 strategic oil fields and could generate 209 billion dollars in tax revenue, she said.
“These investments will help not only the recovery and modernization of our industry, but also the economic growth of our country, to the energy security of our hemisphere and to a greater balance in international markets,” said Rodriguez.
The deal was good for both nations, U.S. Secretary of State Marco Rubio said, potentially providing stable, low-cost oil supplies for the United States while helping investment and job creation in Venezuela.
The plan could free up nearly $100 billion in private investment, he said.
But key details of the arrangement remain unclear, including the fields or companies involved, the legal structure of the deal and how the United States would exercise majority control over the reserves.
U.S. companies are expected to be a major part of new oil exploration and production agreements that Venezuelan officials are rumored to be preparing to sign.
A lease model has been considered but such an arrangement could face legal and constitutional challenges, given the Venezuelan state keeps control over key aspects of its oil industry.
Analysts also warned the deal may not immediately lower U.S. gasoline prices because Venezuela’s heavy crude needs substantial infrastructure to produce, transport and refine, which could take years to develop.
David Goldwyn, president of Goldwyn Global Strategies, asked what the legal basis of the arrangement was and what investment prospects it had offered.
“It is hard to see how this kind of arrangement would accelerate investment at any material scale,” he said, citing political uncertainty, inadequate power grid, limited export capacity and government control over the industry.
The deal is Washington’s bid to secure Venezuelan crude for U.S. refineries and to encourage U.S. investment in the energy sector in Venezuela.
The Trump administration also is facing pressure over gasoline prices with the approaching November U.S. midterm elections.
In the 1970s Venezuela nationalized its oil industry, with state-owned PDVSA at the heart of the sector.
Under former President Hugo Chavez, state controls were increased and foreign-owned assets were expropriated in some cases. Production subsequently fell sharply during the tenure of Nicolás Maduro.
