Trump announces oil deal with Venezuela

President Donald Trump announced on Friday that the United States has entered into an agreement with Venezuela to take control of more than 65 billion barrels of the South American country's proven oil reserves. In a social media post, Trump described it as "THE BIGGEST OIL DEAL IN WORLD HISTORY," saying the agreement was negotiated by Secretary of State Marco Rubio and Defense Secretary Pete Hegseth with Venezuela's interim president, Delcy Rodriguez, "through a partnership with private business."

Trump wrote that the deal secures "majority S. control" of the reserves "at no cost to the American Taxpayer," and that the transaction "MORE THAN DOUBLES American Oil Reserves, greatly increases our Oil Supply, and will substantially lower Gas Prices for all Americans." Secretary of State Marco Rubio called the deal "a huge win for both the American and Venezuelan people," adding in a social media post that it would bring "nearly $100 billion in private investment, support thousands of high-paying jobs, and drive the reconstruction of Venezuela's economy."

Trump did not elaborate on the structure of the agreement, the specific fields involved, or how the S. would exercise control over the reserves. The announcement came nearly nine months after S. forces captured Venezuela's former president, Nicolás Maduro, in a military operation on January 3. Maduro and his wife, Cilia Flores, were taken to the S. to face federal narcoterrorism and drug trafficking charges; they have pleaded not guilty. Since the raid, Venezuela has been led by interim president Delcy Rodriguez, who had served as Maduro's vice president and minister of petroleum.

Background and context

Venezuela holds the world's largest proven oil reserves, estimated at 303 billion barrels, according to multiple reports. The S. Energy Information Administration estimates this represents around 17% of global oil reserves. However, Venezuela's production has lagged far behind its reserve base, currently producing about 25 million barrels per day, due to chronic mismanagement, decaying infrastructure, and sanctions.

The deal follows weeks of reported negotiations between the S. and Venezuelan officials. Reuters reported, citing sources, that the administration was working on an agreement to lock in long-term access to Venezuelan oilfields, with a "lease" model under consideration and a possible auction or tender to allocate fields among S. producers. A list of 17 fields in negotiation included green fields in the Orinoco Belt and mature areas in Lake Maracaibo, some currently operated by a small Chinese firm whose contract was signed during Maduro's administration.

The Wall Street Journal reported that the Trump administration was in "advanced talks" with Venezuelan officials to take "a direct stake in more than a dozen oilfields" containing 90 billion barrels, nearly a third of the country's energy reserves. Axios reported that one unnamed official called the deal "a legacy-defining moment for President Trump," saying "Calling this deal huge would be an understatement … It is massive." Bloomberg reported that one deal under discussion was a 100-year lease on several oilfields.

The White House referred questions to the S. Department of Energy. Venezuela's oil ministry, state oil company PDVSA, and the Energy Department did not immediately reply to requests for comment. Venezuelan oil minister Paula Henao could not be reached for comment.

Industry and legal considerations

Despite the announcement, major S. oil companies have shown caution about returning to Venezuela. According to reporting from Crude Oil Prices Today, ExxonMobil and ConocoPhillips remain reluctant to return, with negotiations slowed by demands for attractive fiscal terms and concerns over political and legal stability. Chevron has operated in Venezuela throughout Maduro's reign, extracting and exporting oil to the S. Smaller players are moving faster: SLB and Hunt Oil have signed agreements, and California-based Pacific Coast Energy Company is finalizing agreements to operate mature heavy-oil fields.

A new $2-billion ownership dispute could complicate matters. The heirs of Oswaldo Cisneros, described as the biggest business dynasty in Venezuela, are contesting ownership of some oilfields for which Pacific Coast Energy is negotiating. The Cisneroses claim the current Venezuelan government "stripped" the family's vehicle company of assets and operational control of some oilfields through an "arbitrary sanctioning" process, and claim $2 billion in losses.

Legal experts and analysts have noted potential hurdles. Current Venezuelan hydrocarbons regulation does not include acreage leases, and the Constitution reserves the industry's core activities to the state. Recently reformed oil legislation allows oilfield operation through joint ventures and production-sharing contracts. For decades, the Venezuelan government has prevented foreign producers from booking the country's oil reserves.

Economic pressures and strategic context

The deal comes at a time of high S. gasoline prices and a depleted Strategic Petroleum Reserve. The average price of a gallon of gas in the S. reached around 09 on Friday, a 27% increase year over year, according to AAA. Department of Energy data shows oil volumes in the Strategic Petroleum Reserve hit lows not seen since the 1980s; the stockpile fell below 300 million barrels in early August, down more than 100 million barrels since the start of 2026. The reserve was tapped following Russia's invasion of Ukraine in 2022 and again after the S. war with Iran began in February.

West Texas Intermediate crude prices fell 4% this week, marking the first losing week of the last three, but prices have jumped more than 24% since the S. war with Iran began. Trump faces mounting pressure over fuel prices ahead of November's midterm elections.

Venezuela is considering leaving OPEC as it strengthens ties with the , Bloomberg reported. Venezuela joined OPEC as a founding member in 1960 and has not met its quotas for years as its state-run oil industry suffered from neglect and corruption.

Energy Secretary Chris Wright is planning a trip to Caracas as soon as next week, according to Axios, to discuss logistics for accelerating field rehabilitation. Analysts at Rystad Energy estimate that meaningful improvement of production capacity would require around $180 billion in investment through the next decade, while keeping current production flat would require more than $50 billion in capex over the next 15 years.

Reactions and criticism

The reports of the deal have sparked criticism from Venezuelan opposition figures and analysts. An unnamed opposition figure called the deal "a land grab" and described the S. as "a rapacious, mafioso United States," according to a Guardian report. Economist Francisco Rodríguez urged Venezuela's national assembly to reject what he called a "predatory deal." Journalist Luz Mely Reyes sarcastically called the deal "the deal of the century." Energy historian Gregory Brew compared the deal to the Anglo-Persian Oil Company's 1901 concession in Iran, saying "It sounds colonial, because it is."

Members of Venezuela's opposition have also expressed unease about the lack of political change since Maduro's capture. Key members of Maduro's regime have retained positions of power, including interior minister Diosdado Cabello, who has been collaborating with Trump officials despite having a $25 million S. bounty on his head for alleged drug trafficking. Exiled opposition leader María Corina Machado, whose movement is believed to have won the 2024 presidential elections, has been sidelined. No date has been set for a fresh presidential election. Trump told reporters last month that Rodriguez was "doing a fantastic job" and that Venezuela was "not really ready" for a vote.