U.S.-Venezuela Tensions: Trump Announces Control of Oil Reserves

The U.S. of America President, Donald Trump has declared a plan that would 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, with the world’s largest proven oil reserves, currently produces about 1.25 million barrels per day, well below its potential after years of underinvestment, mismanagement and U.S. sanctions.

“This agreement will lead to greater production, attract investment and generate additional government revenue,” said Venezuelan interim leader Delcy Rodriguez, who welcomed the agreement.

The plan would include the development of 17 strategic oil fields and could raise 209 billion dollars in tax revenue, she said.

“These investments will contribute not only to the recovery and modernization of our industry, but also to the economic growth of our country, to the energy security of our hemisphere and to a greater balance in international markets,” Rodriguez said.

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.

He said the plan could unlock nearly $100 billion in private investment.

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.

Venezuelan officials are said to be preparing to sign new oil exploration and production agreements, with U.S. companies expected to play a major role.

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A lease model has been considered, but such an arrangement could face legal and constitutional challenges as the Venezuelan state retains control over key aspects of its oil industry.

Analysts also warned that the deal may not immediately lower U.S. gasoline prices, as Venezuela’s heavy crude needs significant infrastructure for production, transportation and refining, 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 a move by Washington to secure Venezuelan crude for U.S. refineries and to encourage American investment in the energy sector in Venezuela.

The Trump administration is also facing pressure over gasoline prices with the November U.S. midterm elections approaching.

In the 1970s, Venezuela nationalized its oil industry, with the state-owned PDVSA at the heart of the sector.

Under former President Hugo Chavez, state control was increased and in some cases foreign-owned assets were expropriated. Production then plummeted under Nicolás Maduro’s tenure.