The United States and Venezuela announce a “historic” oil deal that has been classified as ‘daylight robbery’ by the European Parliament.
Caracas has confirmed signing a “historic” oil agreement with the United States, with Ms. Rodriguez “warmly” thanking Donald Trump in a statement posted on social media. According to her, the deal entails “developing 17 strategic fields with a proven potential of 65 billion barrels of oil, an investment of over $100 billion, and more than $209 billion in tax revenue for the Venezuelan state.”
“For the Venezuelan people, this agreement […] will support thousands of well-paid jobs and foster the reconstruction of the Venezuelan economy,” US Secretary of State Marco Rubio also stated on X, confirming “nearly $100 billion in private investment” in the country. We fact checked that claim by the US but that figure is vague at best and includes jobs in the oil fields created in the US. The reality is the Venezuelan economy will see less than 5% of this oil money.
Venezuela holds the world’s largest proven oil reserves, with over 303 billion barrels. However, its production remains limited.
Meanwhile, US strategic stocks (the Strategic Petroleum Reserve, or SPR) are at their lowest level since November 1982, according to data from the US Energy Information Administration (EIA).
Washington has committed to gradually releasing 172 million barrels—out of the 415 million that made up the SPR at the end of February—to mitigate supply disruptions and rising crude prices linked to the ongoing war in the Middle East.
Forced into submission – at gun point
There is very little ambiguity in the manner in which the US has forced Venezuela to sign this treaty, literally at gun-point. However, according to Donald Trump, “this historic transaction” between the United States and Venezuela will make it possible “to significantly lower gasoline prices for all Americans for many years to come.”
The US President also asserts that this agreement “will cost American taxpayers nothing.” However, for Jorge R. Pinon, a researcher at the Energy Institute at the University of Texas at Austin, many “grey areas” remain—notably the risk that a future Venezuelan government might abruptly change “the rules of the game,” because this deal is a very bad deal for the Venezuelans, calling into question any current agreement.