President Donald Trump announced Friday that the United States has secured "majority U.S. control" of more than 65 billion barrels of Venezuela's proven oil reserves, calling the arrangement the biggest oil deal in world history. The administration says the agreement will lower gas prices for American drivers. Energy experts who have reviewed the limited public details say that outcome is years away, if it materializes at all.
Trump announced the deal in a Truth Social post Friday evening, saying it was negotiated by Secretary of State Marco Rubio and Defense Secretary Pete Hegseth in coordination with Venezuela's interim president, Delcy Rodríguez. The president wrote that the arrangement gives the U.S. majority control of the reserves at no cost to American taxpayers and would "substantially lower Gas Prices for all Americans," according to his post.
The 65 billion barrels covered by the deal represent roughly 21% of Venezuela's total proven oil reserves, which stand at about 303 billion barrels, the largest in the world. According to a U.S. official who described the arrangement to reporters, Rodríguez granted a newly formed joint venture, made up of the U.S. government and a private operator, 100-year concessions covering 17 oil fields. The U.S. government will hold a 55% stake in the venture's effective output, split between equity ownership and guaranteed rights to buy oil at production cost. Oil purchased through the arrangement is intended to help refill the U.S. Strategic Petroleum Reserve and supply the U.S. military.
Rodríguez, in a statement, said the deal calls for developing the 17 fields and could draw about $100 billion in outside investment into Venezuela's oil sector while generating more than $209 billion in tax revenue for the Venezuelan government. She said the agreement would have a significant impact on her nation's revival. No full text of the agreement had been made public as of Monday, and key details, including who will finance the infrastructure work and on what timeline, have not been disclosed.
The deal comes nearly eight months after U.S. forces captured then-president Nicolás Maduro in a raid and brought him to New York to face federal drug trafficking charges, clearing the way for Rodríguez's interim government. It also arrives as gas prices climb amid the reignited U.S.-Iran conflict, which has disrupted shipping through the Strait of Hormuz and pushed crude prices higher. The national average price of gasoline stood at $4.08 a gallon on Saturday, according to AAA data, up from $3.20 a gallon at the same point last year.
Administration officials tout the deal as a fix for gas prices
Rubio, writing on X, said the agreement would bring billions in private investment into Venezuela and result in lowering gas prices here at home. Trump has separately said he plans to direct proceeds from the arrangement toward rebuilding the Strategic Petroleum Reserve, which he says was left depleted by the prior administration.
The administration's framing places the deal at the center of its response to rising fuel costs, an issue that has taken on added political weight as the Iran conflict keeps oil markets on edge ahead of the November elections.
Energy analysts question how fast, or whether, the deal delivers
Several energy specialists interviewed by national outlets in the days following the announcement raised doubts about how quickly, or whether, the agreement will translate into cheaper gas for U.S. drivers.
David Goldwyn, who served as the State Department's special envoy for international energy affairs under President Barack Obama, noted that no formal text of the agreement has been released, leaving analysts to work largely from social media posts and secondhand accounts. As Goldwyn put it, industry watchers are "still operating on Tweets and rumors."
Amy Myers Jaffe, director of the Energy, Climate Justice and Sustainability Lab at New York University, said the deal could prove "helpful in the long run" but won't move pump prices in the near term. Paasha Mahdavi, an associate professor of political science at UC Santa Barbara who studies the oil industry, was more blunt: his initial excitement gave way to doubt once he examined the terms, concluding "this may not actually do anything."
Mahdavi and other analysts pointed to the "at cost" structure of the U.S. stake as a potential deterrent to the large American oil companies whose participation would be needed to expand production. Because the U.S. share is tied to production cost rather than market price, oil companies have less incentive to invest heavily, since they would not capture the extra profit available when crude prices are high. Gerald Kepes, president of the Washington-based consultancy Competitive Energy Strategies, also flagged a structural question: the U.S. does not operate a national oil company, raising doubts over who would actually run day-to-day operations on the ground in Venezuela.
Adding to the uncertainty, officials have not named the private company that will operate alongside the U.S. government in the new joint venture. Any meaningful expansion of Venezuelan output would likely require participation from the largest American oil companies with the technical expertise to rebuild aging fields, but those firms have historically been cautious about committing large sums to Venezuela given the country's political instability and decades of underinvestment in its infrastructure.
Decades of underinvestment left Venezuela's oil sector in decline
The skepticism centers on the physical state of Venezuela's oil infrastructure, which has deteriorated for more than a decade. According to the U.S. Energy Information Administration, Venezuela's energy production fell by an average of 8.2% per year between 2011 and 2021, a decline the agency attributes to government mismanagement, international sanctions and a broader economic crisis that starved the sector of investment and maintenance. Venezuela now accounts for less than 1% of global oil output, ranking outside the world's top 15 producers, a fraction of the production levels the country posted before its state oil company, PDVSA, fell into disrepair.
Rebuilding that capacity to a level that would meaningfully affect global supply, and by extension U.S. gas prices, would require years of sustained investment in aging pipelines, wells and export terminals, according to the experts who reviewed the deal. None of the officials involved in announcing the agreement have offered a public timeline for when expanded production might begin, or estimated how long it would take before any new supply reached the market.
Not every analyst is as skeptical. Claudio Galimberti, chief economist at the energy research firm Rystad Energy, has called the agreement strategically important, saying it could unlock a new wave of investment in Venezuela's oil sector over time. Even that more optimistic view centers on the deal's long-run potential rather than any near-term relief at the pump.
What remains unresolved
Beyond the financing and infrastructure questions, analysts also pointed to unresolved questions about the durability of the arrangement itself, given that it rests on the political standing of Rodríguez's interim government. Because no agreement text has been published, it also remains unclear how disputes over the deal's terms would be resolved or what protections, if any, exist for the American company should conditions in Venezuela shift.
For now, the deal does not appear to be driving near-term price action. Oil and equity markets moved Monday primarily on the escalating U.S.-Iran conflict, with crude prices climbing above $90 a barrel after new strikes near the Strait of Hormuz. Market coverage of Monday's trading session attributed the moves to the Iran conflict rather than to the Venezuela agreement.
The White House has not said when, or whether, it plans to release the full terms of the agreement.
