Venezuela Deal Won't Lower Gas Prices Anytime Soon
A deal between the US and Venezuela has been struck to give the US a key role in the oil industry of Venezuela, but it won't reduce domestic gasoline prices anytime soon. The agreement will allow the US to secure billions of barrels of Venezuelan oil at favorable prices, with the US government taking a 35% ownership stake in the new entity.
The deal was announced by President Donald Trump on August 31, and he acknowledged that it wouldn't immediately lower gas prices for consumers. Oil experts told PolitiFact that gains for consumers won't materialize anytime soon and would likely take years to happen.
Venezuela has huge oil reserves but crumbling infrastructure, and the agreement will require large investments in infrastructure over several major areas. Experts expect it would take four to 10 years for Venezuelan oil production to expand significantly, assuming billions of dollars of investment materializes.