Key facts
- President Trump announced a deal for US majority control of 65 billion barrels of Venezuelan oil reserves.
- The agreement is structured as a 100-year oil field lease through a public-private partnership.
- The US will take a 55% stake in a new joint venture with a private Venezuelan operator.
- Venezuela is now the second-largest source of US oil imports, with crude imports quadrupling this year.
- The deal aims to enhance US energy security and replenish the Strategic Petroleum Reserve.
- The US administration will partner with a private Venezuelan oil company closely linked to the country's government.
President Donald Trump announced a significant oil agreement with Venezuela, which he stated would secure majority US control over 65 billion barrels of the country's proven oil reserves. This deal, described as the largest oil deal in history, is structured as a 100-year lease for an oil field through a public-private partnership, with the US taking a 55% stake in a new joint venture with a private Venezuelan operator. The agreement was brokered by Secretary of State Marco Rubio and Defense Secretary Pete Hegseth and comes at no cost to American taxpayers.
The deal is crucial for US energy security, as Venezuela has become the second-largest source of US oil imports, with crude imports quadrupling this year to approximately 600,000 barrels per day. Many US refineries, built in the 1970s, are specifically designed to process Venezuela's heavy, sour crude, which is ideal for producing asphalt, industrial oils, diesel, and jet fuel. An increase in these imports would enhance refinery efficiency.
Furthermore, the agreement is intended to help replenish the US Strategic Petroleum Reserve, which has fallen to its lowest level since 1982. The US captured former Venezuelan president Nicolás Maduro in January, and since then, Washington has sought to ensure a stable flow of Venezuelan crude while promoting investment in the nation's energy industry. Venezuela is currently producing about 1.2 million barrels per day, an increase since Maduro's removal.
The US administration will collaborate with a private Venezuelan oil company that maintains close ties to the country's government. This partnership is seen as a potential game-changer, offering skeptical US companies the assurance needed to invest in Venezuela's oil operations. The deal is also expected to benefit the Venezuelan economy, which has seen progress in ramping up oil production.