Trump's Venezuela Oil Deal Won't Bring Immediate Price Relief
US President Donald Trump announced a deal to give the US a key role in Venezuela's oil industry, which has huge reserves but crumbling infrastructure. The agreement will give the US government a 35% ownership stake in North American Blue Energy Partners, headed by Venezuelan businessman Alejandro Betancourt.
The new entity will have 100-year rights to 17 Venezuelan oil fields with 65 billion barrels of proven reserves. However, experts say that gains for consumers will not materialize any time soon and would likely take years, long after the midterm elections in November.
Oil production in Venezuela is expected to expand in a significant way over four to ten years, assuming billions of dollars of investment materializes. The up-front costs associated with infrastructure will be quite large, and there is a lot of uncertainty in the long-term ability for companies to operate there.