Business 5 min read By Bethany Hadley
US closes in on deal to control Venezuela’s oil reserves
The United States is nearing an agreement with Venezuela to take control of the country’s vast oil reserves, a move that could reshape global energy markets and benefit American oil companies.
The United States is closing in on a landmark agreement with Venezuela that would give Washington control over the South American nation’s vast oil reserves, a deal that could have major implications for global energy markets and American oil producers.
President Donald Trump announced the agreement on Friday, describing it as “the biggest oil deal in world history.” The arrangement, negotiated by Secretary of State Marco Rubio, Defense Secretary Pete Hegseth, and Venezuela’s interim President Delcy Rodriguez, would place 65 billion barrels of Venezuelan crude under US control.
The announcement comes nearly nine months after US military forces captured Venezuela’s president Nicolás Maduro and transported him to the United States to face federal narcoterrorism and drug trafficking charges. Maduro’s removal from power in January opened the door for renewed American involvement in the country’s energy sector.
Venezuela holds one of the largest oil reserves on the planet, with an estimated 303 billion barrels of crude in the ground, representing roughly 17 percent of the world’s supply, according to the US Energy Information Administration. Unlike many other regions where geologists must search for untapped deposits, Venezuela’s reserves are largely mapped and well understood.
Despite this abundance, the country currently produces only about one percent of the world’s oil due to dilapidated infrastructure and years of underinvestment. Decades of political turmoil and economic mismanagement have left the state-owned oil industry in a state of severe decline.
The deal is being driven in part by mounting pressure on the Trump administration to address high gasoline prices at home. The war in Iran has reached its sixth month with no resolution in sight, keeping global crude prices elevated and straining American consumers.
The United States has already tapped its strategic petroleum reserves to ease supply pressures, with stockpiles falling below 300 million barrels in early August, down by more than 100 million barrels since the start of 2026. The reserves are at their lowest levels in decades, limiting Washington’s ability to respond to further disruptions.
Trump has long argued that Venezuela effectively stole American oil when former President Hugo Chávez nationalised hundreds of foreign-owned assets, including those belonging to US companies, decades ago. The administration has framed the new agreement as a corrective measure that restores American access to resources that were unjustly seized.
In the days following Maduro’s ouster, Trump floated the idea of US oil companies returning to Venezuela to tap its reserves. The new agreement appears to formalise that vision, potentially opening the door for American firms to resume operations in the country.
For US oil companies, the deal represents a significant potential opportunity. Venezuela’s reserves are among the most accessible in the world, and its proximity to American refineries on the Gulf Coast makes it a strategically valuable source of crude. The country’s heavy oil grades are particularly well suited to US refining capacity.
However, significant challenges remain. Venezuela’s oil infrastructure has deteriorated badly over the past two decades, and restoring production to meaningful levels would require substantial investment and time. Industry analysts note that even with American expertise and capital, reviving Venezuela’s oil sector would be a multi-year undertaking.
The agreement also carries geopolitical implications. Venezuela’s oil wealth has long been a source of influence for its allies, including Russia and China, both of which have invested in the country’s energy sector. A US takeover of reserves would represent a significant shift in the balance of power in the region.
The full details of the agreement have not yet been made public, and it remains unclear how the arrangement would be implemented in practice. Questions about compensation for existing stakeholders, the legal framework for US control, and the timeline for resuming production are all yet to be answered.
For now, the announcement marks a dramatic escalation of American involvement in Venezuela’s energy sector, with potential consequences for global oil markets, US gasoline prices, and the strategic position of American energy companies.
