Trump Plan Risks Derailing Venezuela's Oil Recovery with Two-Tiered Market
The Trump administration's plan to acquire a 35% equity stake in North American Blue Energy Partners (NABEP), a private oil firm controlled by Venezuelan businessman Alejandro Betancourt, has sparked concerns that it could derail Venezuela's long-awaited petroleum revival.
NABEP would receive a 100-year lease on 17 Venezuelan oilfields holding an estimated 65 billion barrels of reserves in exchange for the U.S. stake. The deal would grant the U.S. a guaranteed 20% share of production at cost and a right of first refusal to purchase all remaining output.
Critics argue that this arrangement could create a two-tiered market in Venezuela, where companies competing with NABEP would face structural disadvantages due to privileged commercial terms. This could deter foreign investment needed to rebuild the country's battered energy industry.
Venezuela's oil production collapsed following years of underinvestment, operational mismanagement, and corruption after nationalization in 2007. The country's output has fallen from roughly 3.5 million barrels per day (bpd) in the 1990s to about 1 million bpd today.