The United States and Venezuela have finalized an expansive oil deal, granting a U. S.-led company a century-long concession over 17 Venezuelan oilfields. Signed in Caracas on Wednesday, this agreement involves a massive 65 billion barrels of crude, which accounts for more than 20% of Venezuela's proven oil reserves. Both countries are calling it a win. U. S. President Donald Trump declared it a historic deal, while Interim Venezuelan President Delcy Rodríguez described it as 'historic, ' forecasting $100 billion in investment and upwards of $200 billion in tax revenue.
The deal, however, is not without its critics. Elliott Abrams, formerly Trump's special representative on Venezuela and Iran, slammed the agreement as a 'terrible deal, ' suggesting that Rodríguez has handed over a significant portion of the country's national patrimony. He questioned the motivations behind this move, hinting that it may be a reaction to U. S. pressures.
The White House has shared details of the agreement, which involves a partnership with North American Blue Energy Partners (Nabep), now the second-largest private oil producer in Venezuela after Chevron. The U. S. government will hold substantial sway over Nabep, possessing veto power over board appointments and requiring that a majority of the board members be U. S. citizens.
With oil prices climbing due to ongoing conflicts in the Middle East, the U. S. views this deal as a strategic repositioning of the global energy market. Secretary of the Interior Doug Burgum highlighted that the agreement shifts the geopolitical center of energy markets away from the Middle East and towards the Western Hemisphere.
Despite the rosy projections, experts warn that the timeline for generating profits might be overly optimistic. Trump predicted profits within two to three years. But energy specialists caution that Venezuela's struggling oil sector could delay this by up to a decade. Luis Pacheco from the Baker Institute at Rice University noted that Venezuela needs about $100 billion in investment over eight years to bring its oil production back to previous levels.
Opposition figures in Venezuela have raised alarms over the growing relationship between Trump and Rodríguez, accusing her of continuing the same regime as Nicolás Maduro. The Trump administration, which had previously condemned Maduro's government as corrupt, is now working with his former vice-president, angering many in the opposition.
Venezuelan economist Ricardo Hausmann criticized the U. S. for aligning with what he called 'oppressors' instead of working to restore democracy. He accused the U. S. of pushing through an 'unconstitutional agreement' with an illegitimate government.
Inside Venezuela, the deal has also provoked discontent among socialists. While the ruling socialist party, PSUV, backs Rodríguez, some see the agreement as a betrayal of their long-standing opposition to U. S. influence. Rafael Ramírez, the former head of the state energy firm PDVSA, lamented the deal as a step toward new colonialism.
Venezuela has historically resisted U. S. control over its oil resources. In 2008, former President Hugo Chávez expropriated ExxonMobil assets, vowing never to cede control again. Yet, his successor's successor has now inked a deal with Washington, marking a considerable shift in Venezuela's stance on its oil wealth.
