Trump says US has entered deal with Venezuela to take control of 65 billion barrels of oil reserves

WASHINGTON — President Donald Trump said Friday (Aug 28) that his administration has entered a sweeping agreement with Venezuela that, if realised, could give the US access to vast amounts of the South American country's untapped oil reserves, at cost.

Trump in a social media post announcing the agreement said it was negotiated by Secretary of State Marco Rubio, Defence Secretary Pete Hegseth and Venezuela's acting President Delcy Rodríguez.

"The United States of America has just entered into an Agreement with the Country of Venezuela on, THE BIGGEST OIL DEAL IN WORLD HISTORY!" Trump wrote.

Rodríguez's government in a statement said the deal involves the development of 17 fields with a proven potential of 65 billion barrels. It said the agreement could draw US$100 billion (S$127 billion) in investment into Venezuela's oil industry and yield over US$209 billion in taxes for Caracas.

Rodríguez in a posting on Telegram predicted the deal "will have a significant impact on our nation's revival."

The agreement allows for the United States to partner with an unnamed private operator in Venezuela to create a new private company to take hold of the reserves, according to a US official familiar with the contours of the deal.

The official, who was not authorised to comment publicly and spoke on the condition of anonymity, added that Rodríguez granted the company 100-year rights to develop the oil fields.

The deal gives the United States 55 per cent effective output of the new private company — including an ownership stake and rights to buy oil at cost. The company would be the second largest corporate holder of proven reserves after Saudi Aramco, according to the official.

Trump is under pressure to show he's lowering oil costs

The announcement comes nearly nine months after the US military at Trump's direction carried out an operation to capture Venezuela's then-President Nicolás Maduro and spirit him to the United States to face federal narcoterrorism and drug trafficking charges.

Trump faces mounting pressure to address high gas prices as the war in Iran on Friday reached a six-month milestone with no conclusion in sight. The US has tapped its strategic petroleum reserves, which in early August fell below 300 million barrels, down by more than 100 million barrels since the start of 2026.

The US-Israel war against Iran has led to a dramatic slowdown of Gulf oil moving through the Strait of Hormuz, which about 20 per cent of the world petroleum passed through prior to the conflict.

The average price of gas in the US stood at about US$4.09 a gallon on Friday, according to AAA. The average price was US$3.21 at the same time last year.

A significant drop in US gas prices tied to the agreement should not be expected immediately. Experts have repeatedly warned that a substantial boost in Venezuelan oil production will not happen quickly as repairing and expanding infrastructure takes years and requires billions of dollars.

Persuading big American oil companies to return the region could face headwinds given the political uncertainty and decades of badly damaged infrastructure.

Days after the ouster of Maduro, Trump gathered oil executives at the White House and called on them to rush back into Venezuela. Executives expressed interest in the opportunity but there was also a measure of caution given their past experience in the country.

Darren Woods, CEO of ExxonMobil, the largest US oil company, said at that moment he saw the country as "un-investable."

But Trump has insisted that his administration has brought a measure of stability to Venezuela.

He has argued that Venezuela stole US oil when former Venezuelan President Hugo Chávez moved decades ago to nationalise hundreds of foreign-owned assets, including those owned by American oil companies.

Rodríguez, in one of her early moves after taking power, signed a law that opens the nation's oil sector to privatisation and reversed a bedrock tenet of the self-proclaimed socialist movement that has ruled the country for more than two decades.

Rubio said on X that the agreement would usher in billions in private investment into Venezuela and lead to lower gas prices in the United States.

"This deal is a huge win for both the American and Venezuelan people," Rubio posted.

The oil bought from the new company would go toward filling the US strategic petroleum reserve and toward military use, according to the US official.

Venezuela has one of the largest oil reserves in the world, with an estimated 303 billion barrels of crude oil in the ground. That's about 17 per cent of the world's supply, according to the US Energy Information Administration. Unlike other parts of the world, where geologists have to search for untapped oil, the reserves under Venezuela's soil are largely mapped and known, experts say. But because of dilapidated infrastructure, the country only produces about one per cent of the world's oil.

Maduro remains jailed in the US He has pleaded not guilty.

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