Trump's Venezuela Oil Deal: A Strategic Move with Uncertain Timeline
US President Donald Trump announced on Friday that his administration has reached a 'historic' deal with Venezuela, giving the US majority control over more than 65 billion barrels of oil reserves. The agreement is seen as a strategic move to increase oil production and stability in international markets.
The deal allows private operators to play a central role in developing the oil fields, which contain proven reserves of 17 strategic fields with a potential of 65 billion barrels of oil. This investment is expected to contribute not only to Venezuela's economic growth but also to the energy security of the hemisphere and stability in international markets.
The deal does not immediately lower gas prices for Americans as it will take time for the new entity to scale production and supply at-cost oil to the US. The Secretary of State Marco Rubio called the deal a 'huge win' for America, saying that it means lowering gas prices here at home.
However, experts warn that the physical work required to drill and pump the oil will take a long time, and changes to fuel prices won't happen overnight or even in months. Patrick De Haan, the head of petroleum analysis for GasBuddy/PDI, said 'drilling and pumping that oil will take a very long time. Changes to fuel prices won’t happen overnight or even in months.'
The deal is linked to 17 oil fields in Venezuela, not access to already-produced crude oil. The country's infrastructure is currently not capable of producing the oil at a rate that would significantly and rapidly affect the wallets of everyday Americans.