President Donald Trump has unveiled an unprecedented US effort to take control of a fifth of Venezuela’s enormous oil reserves, arguing that American companies can restore the OPEC nation’s battered energy sector while supplying additional crude to help reduce fuel prices in the United States.
Mr Trump offered few specifics, saying the United States had obtained majority control of more than 65 billion barrels of Venezuela’s proven reserves through a partnership with private companies.
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“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 US control of more than 65 BILLION BARRELS of proven Oil Reserves in Venezuela, at no cost to the American Taxpayer,” Mr Trump wrote on Truth Social.
The announcement follows weeks of negotiations between Washington and Caracas over an arrangement that would give US companies long-term access to a number of Venezuelan oilfields and guarantee that the resulting crude would flow to the United States.
Sources previously told Reuters that officials were considering a lease-based system under which the fields could be auctioned to US producers. Such a plan, however, could face legal and constitutional challenges in Venezuela, where the state maintains control over key parts of the oil industry.
The agreement would mark a sweeping expansion of the US presence in Venezuela’s energy sector, as the Trump administration seeks both to restore the country’s declining production and to secure additional crude for American refineries.
Venezuela possesses the world’s largest proven oil reserves, yet its output stands at only about 1.25 million barrels per day. Production has fallen well below its potential after years of underinvestment, mismanagement and sanctions.
Mr Trump did not identify the fields or companies covered by the agreement. He also did not explain how the arrangement is structured or how the United States would exercise majority control over the reserves.
Secretary of State Marco Rubio called the deal beneficial to both nations, writing on X that it would provide the United States with a stable supply of low-cost oil and help bring down gasoline prices.
For Venezuela, Mr Rubio said the agreement would attract nearly $100 billion in private investment, create thousands of high-paying jobs and contribute to rebuilding the country’s economy.
Legal basis unclear
Analysts said they would need further information about the agreement’s legal and financial framework before determining whether it could draw substantial investment.
It was also uncertain whether the deal could reduce gasoline prices in the near term. Rebuilding the infrastructure required to produce, transport and refine Venezuela’s heavy crude could take years.
David Goldwyn, president of Goldwyn Global Strategies, said the legal foundation for a US government lease was unclear under Venezuela’s constitution and new hydrocarbons law. He added that there was “no precedent for having the US government enter into a lease to operate oil fields.”
Mr Goldwyn questioned whether the proposal would overcome the barriers that have kept investors away from Venezuela for years.
“It is hard to see how this kind of arrangement would accelerate investment at any material scale,” he said, pointing to political uncertainty, an unreliable power grid, restricted export capacity and the government’s discretion over the sector.
Since the US captured and removed former President Nicolas Maduro from power in January, Washington has sought to secure a dependable flow of Venezuelan crude for American refineries while encouraging US investment in the country’s oil industry.
The Trump administration faces pressure ahead of midterm elections scheduled later this year, with rising gasoline prices a concern that could be addressed through cheaper oil supplies and increased production.
Lower-cost crude and higher output could provide some relief.
Washington has also been exploring ways to replenish the Strategic Petroleum Reserve, the country’s emergency oil stockpile, including possible crude swaps with US producers.
Venezuela nationalised its oil industry in the 1970s, placing state-run PDVSA at its core.
During the presidency of Hugo Chavez, the government expanded its control by requiring foreign producers to operate through state-led joint ventures and later expropriating assets, including projects run by Exxon Mobil and Conoco Phillips.
Under Mr Maduro, years of underinvestment, mismanagement, political upheaval and US sanctions sent Venezuela’s oil production into a steep decline.
