In short
- The agreement grants a US-led company 100-year concessions over 17 oilfields in Venezuela, covering 65 billion barrels of crude, more than a fifth of the country’s proven reserves.
- The White House will work with North American Blue Energy Partners (Nabep), Venezuela’s second-largest private oil producer after Chevron, and holds veto power over appointments to its board, a majority of which must be US citizens.
- Interim Venezuelan President Delcy Rodríguez said the deal would generate $100bn in investment and more than $200bn in tax revenue, while US President Donald Trump called it the biggest oil deal in world history.
- Luis Pacheco, of the Baker Institute at Rice University in Houston, said Venezuela needs about $100bn over eight years to return to its oil production levels of 30 years ago.
- Elliott Abrams, Trump’s former special representative on Venezuela and Iran, called the deal terrible and said Rodríguez had given away 20% of the national patrimony for nothing.
A US-led company has been granted 100-year concessions over 17 oilfields in Venezuela, covering 65 billion barrels of crude, under an agreement signed in Caracas on Wednesday. The White House released a fact sheet on the framework, and both governments welcomed the agreement. The 65 billion barrels equate to more than a fifth of Venezuela’s proven oil reserves.
What does the US-Venezuela oil deal include?
The White House fact sheet released on Tuesday said the US government will work alongside North American Blue Energy Partners (Nabep), described as Venezuela’s second-largest private oil producer after Chevron. Under the framework, Washington holds “veto power over the appointment of any member of the board of directors, and a majority of Nabep’s board of directors must be US citizens”. The deal has also renewed attention on the private figures involved, among them Alejandro Betancourt, the oil baron in the US-Venezuela deal.
What did Trump and Rodríguez say about the deal?
US President Donald Trump called the agreement “the biggest oil deal in world history”. Venezuela’s interim president, Delcy Rodríguez, said it was “historic” and would generate $100bn (£74bn) in investment and more than $200bn in tax revenue. Secretary of the Interior Doug Burgum told Fox Business the pact was “shifting the geopolitical centre of the global energy markets” away from the “choke points in the Middle East” and back to the Western Hemisphere. The White House said the deal had “re-established the Monroe Doctrine”, the 19th-century principle of US primacy in the Americas.
Who opposes the US-Venezuela oil deal?
Elliott Abrams, Trump’s former special representative on Venezuela and Iran, called it “a terrible deal” and said Rodríguez “has given away 20% of the national patrimony for nothing”. He described the terms as “a kind of fever dream of what colonialism looks like”. Venezuelan economist Ricardo Hausmann, directing his comments at US Secretary of State Marco Rubio, said Washington had “opted to push through an asset seizure, an unconstitutional agreement with an illegitimate and oppressive government”. Rafael Ramírez, a former oil minister under Hugo Chávez and head of the state firm PDVSA, said the deal “opens the doors to a new colonialism of the United States”.
Venezuela’s opposition is concerned the agreement deepens Trump’s relationship with Rodríguez, whom they accuse of heading the same regime as Nicolás Maduro. The Trump administration has decried Maduro’s government as a corrupt drug cartel and has also dropped Venezuela and Bolivia from its list of countries not complying with drug-fighting obligations. The opposition camp includes the Nobel Peace Prize winner and presidential hopeful María Corina Machado.
How soon will the deal produce oil revenue?
Trump has said the agreement will generate profit within two or three years. Energy experts warn that the state of Venezuela’s oil sector makes a decade more realistic. Luis Pacheco, of the Baker Institute at Rice University in Houston, told BBC Mundo that Venezuela needs to invest about $100bn over eight years to return to its oil production levels of 30 years ago. “It’s important to know who will manage those resources and for what purpose,” Pacheco said, asking whether the same people who “already squandered the biggest oil boom of the century” would be put in charge.
Frequently asked questions
What does the US-Venezuela oil deal include?
It grants a US-led company 100-year concessions over 17 oilfields in Venezuela, covering 65 billion barrels of crude. The US government will partner with North American Blue Energy Partners (Nabep) and holds veto power over board appointments at the firm.
Who announced the US-Venezuela oil deal?
The agreement was signed in Caracas and welcomed by US President Donald Trump and Venezuela’s interim president, Delcy Rodríguez. The White House released a fact sheet setting out the framework on Tuesday.
How soon will Venezuela’s oil deal generate profit?
Donald Trump has said the agreement will generate profit within two or three years, while energy experts warn that the state of Venezuela’s oil sector makes a decade a more realistic timeframe.
Who criticises the US-Venezuela oil deal?
Elliott Abrams, Trump’s former special representative on Venezuela and Iran, called it a terrible deal, and Venezuelan economist Ricardo Hausmann said Washington had pushed through an unconstitutional agreement with an illegitimate government. Former PDVSA head Rafael Ramírez said it opens the doors to a new colonialism.
With reporting from BBC News.
Stock image, not from the events described. City Skyline — Joe deSousa / Wikimedia Commons (CC0 1.0)
