US-Venezuela Oil Deal Faces Years of Delays
The United States and Venezuela have struck an agreement to give the US a key role in Venezuela's oil industry, but it won't lower domestic gasoline prices anytime soon. President Donald Trump announced the deal on August 31, saying that while it will take time for benefits to materialize, he expects prices to eventually come down.
The agreement gives the US government a 35% ownership stake in a new entity, North American Blue Energy Partners, which will have 100-year rights to 17 Venezuelan oil fields with 65 billion barrels of proven reserves. The Pentagon's involvement in the deal is unusual and has raised concerns that it could be seen as an abuse of power.
Oil experts predict it will take four to ten years for Venezuela's oil production to expand significantly, assuming billions of dollars in investment materializes. They also warn that the US Strategic Petroleum Reserve may not be able to store Venezuelan heavy crude, which would require a separate solution.