U.S. President Donald Trump has announced an agreement giving the United States majority control over more than 65 billion barrels of Venezuela’s proven oil reserves, establishing a potentially far-reaching U.S. role in the country’s energy sector.
Trump announced the deal on Aug. 28, calling it “THE BIGGEST OIL DEAL IN WORLD HISTORY!” He said the agreement was negotiated by Secretary of State Marco Rubio, Defense Secretary Pete Hegseth and Venezuelan interim President Delcy Rodríguez.
“At my direction, Secretary of State Marco Rubio, and Secretary of War Pete Hegseth, working closely with Highly Respected Interim President of Venezuela, Delcy Rodriguez, and, through a partnership with private business, have secured majority U.S. control of more than 65 BILLION BARRELS of proven Oil Reserves in Venezuela, at no cost to the American Taxpayer,” Trump wrote on social media.
The full text of the agreement has not been released, leaving major questions about its legal structure, ownership, financing and duration.
According to U.S. officials, the arrangement involves a new private company formed by the U.S. government and an unnamed Venezuelan private operator. The company would develop 17 oil fields with proven potential of about 65 billion barrels. The U.S. would receive a 55% effective share of the company’s output, including an ownership stake and rights to purchase oil at cost, according to a U.S. official who spoke on condition of anonymity.
The oil purchased by the United States is expected to be used to replenish the Strategic Petroleum Reserve and support military requirements.
Venezuela controls more than 300 billion barrels of proven crude oil reserves, roughly 20% of the world’s total and the largest proven oil reserve base of any country, ahead of Saudi Arabia.
Agreement Targets 1.5 Million Barrels Per Day
Rodríguez said Aug. 29 that the agreement covers 17 strategic oil fields and targets production of more than 1.5 million barrels per day.
“This 25-year bilateral project envisages the development of 17 strategic oilfields with a production target of more than 1.5 million barrels per day,” Rodríguez said on state broadcaster VTV. “That figure relates solely to the bilateral agreement between Venezuela and the United States.”
She said the 1.5 million-barrel-per-day target is an initial objective and that Venezuela’s broader energy expansion plan includes eight additional greenfield blocks.
Rodríguez also said the agreement could generate about $209 billion in revenue for the Venezuelan state, based on an assumed oil price of $65 per barrel. She said about $19 from each barrel produced and sold under the arrangement would flow directly to the Venezuelan government.
She said Venezuela retained “ownership of and sovereignty” over its natural resources, “while leveraging capital, technology and operational expertise to support the recovery of a strategic industry that has been severely affected by sanctions.”
25 Years or 100 Years?
The duration of the agreement remains one of its most important unresolved details.
Rodríguez said the bilateral energy project would last 25 years. U.S. officials and reporting on the structure of the private venture, however, have described 100-year rights to develop the oil fields.
The discrepancy cannot be conclusively resolved without publication of the agreement itself.
The distinction is important because the proposed development involves both existing fields that have suffered years of underinvestment and new, or greenfield, acreage. A 100-year development right would represent a far more durable U.S. commercial foothold than a 25-year bilateral project.
Little Near-Term Impact on US Fuel Prices
The agreement is unlikely to produce a rapid increase in Venezuelan oil exports or significantly reduce U.S. gasoline prices in the near term.
Venezuela holds the world’s largest proven oil reserves but currently produces roughly 1.25 million barrels per day, according to Reuters, well below its historical production capacity. Years of underinvestment, mismanagement and sanctions have left much of the country’s oil infrastructure in poor condition.
Amy Myers Jaffe, director of the Energy, Climate Justice and Sustainability Lab at New York University, said the deal could be “helpful in the long run, but it’s not going to do anything to change the price of gasoline at the retail station for Labor Day weekend.”
Kevin Book, managing director at ClearView Energy Partners, said Venezuela has substantial capacity to increase production but cautioned that developing the necessary infrastructure would take years.
“It’s going to take time — many years — to deploy that much capital and produce the kind of incremental results that history suggests possible,” Book said.
The proposed production target of more than 1.5 million barrels per day therefore represents a long-term objective rather than an immediate supply increase.
Strategic and Geopolitical Stakes
The agreement gives Washington a substantial commercial and strategic position in Venezuela’s energy sector at a time when the United States is seeking greater control over Venezuelan oil flows.
It also reduces the space for rival powers, particularly China and Russia, to maintain or expand their influence over Venezuela’s petroleum industry.
China has been a major customer and investor in Venezuela’s oil sector, while Russia has also developed ties with Caracas. The new U.S. arrangement could shift the balance of influence in one of the world’s largest oil-producing states.
For Washington, the value of the deal therefore extends beyond the volume of crude involved. A sustained U.S. role in Venezuela could provide greater influence over a major Western Hemisphere energy resource while strengthening U.S. access to additional heavy crude supplies.
Investment and Security Risks Remain
Turning Venezuela’s reserves into sustained production will require significant investment.
Rodríguez said the agreement could attract about $100 billion in investment to the country’s oil industry. But the sources supplied do not establish who will provide that capital, how the investment will be financed or how the financial risk will be divided between the U.S. government, private companies and Venezuela.
The willingness of major U.S. oil companies to commit capital will also depend on the security and legal protections surrounding their operations.
Chevron, the only U.S. oil company currently producing in Venezuela, declined to comment on the announcement. Exxon Mobil also declined to comment.
Venezuelan officials are preparing new oil exploration and production agreements with several companies, including U.S. firms. Reuters reported that Chevron was among the companies expected to finalize talks to transition its Venezuelan joint ventures into the new energy framework.
Political Backlash in Venezuela and the US
The agreement has faced criticism inside Venezuela, where opponents argue that the government is conceding too much control over the country’s natural resources to Washington.
At a market in eastern Caracas on Aug. 29, Douglas Borjas criticized the arrangement.
“I think they’re doing it to cling to power,” he said of Venezuela’s leaders. “It’s like, ‘I’m giving you a vast amount of petroleum as long as you leave me alone here in power.'”
He added: “The Venezuelan people deserve better. Venezuela has resources that can be exploited, but for the benefit of the people, not for the benefit of the corrupt elite.”
Ricardo Hausmann, a Harvard University professor and former Venezuelan planning minister, called the agreement a “shameful deal.”
“Venezuelans will not respect this illegitimate deal and no major US oil company will take it seriously because they know it will not last,” Hausmann said on social media, adding that Rodríguez “has no legitimacy or constitutional power to commit Venezuela to any such deal.”
The agreement has also drawn criticism from U.S. Democrats, who have argued that Trump’s Venezuela policy is driven by access to the country’s oil.
Sen. Tim Kaine, D-Va., described the arrangement as “corruption at epic scale.”
“Will prices come down for Americans? Who knows but likely not as much as Trump has forced them up thru his idiotic Iran War,” Kaine said on social media.
Sen. Chris Van Hollen, D-Md., said Trump “put our service members at risk to get Venezuelan oil for his billionaire buddies.”
Republican supporters have defended the agreement as a strategic and economic gain for both countries.
What Remains Unclear
Despite the scale of the announcement, several fundamental details remain unresolved.
The public has not seen the agreement itself. It remains unclear how the U.S. government’s 55% effective share is divided between ownership and rights to purchase crude at cost, who the private Venezuelan operator is, who will finance the required infrastructure and what legal protections will govern the venture.
The conflicting descriptions of the agreement’s duration also remain unresolved, with U.S. reporting pointing to 100-year development rights and Rodríguez describing a 25-year bilateral project.
The immediate economic impact is likely to be limited. The strategic implications are potentially much larger.
If Washington and Caracas can attract the capital and expertise needed to rebuild Venezuela’s oil industry, the agreement could establish a durable U.S. position in one of the world’s largest petroleum resource bases and reshape the geopolitical balance around Venezuelan energy.
For now, however, the headline figure of 65 billion barrels is better understood as the scale of the resource involved than as a measure of oil that can quickly reach U.S. markets.