What’s in Trump’s Allegedly Greatest Oil Deal in History, with Venezuela?

The United States has announced a controversial agreement with Venezuela to secure majority control of more than 65 billion barrels of proven oil reserves, a move President Donald Trump described as the "greatest oil deal in world history." The deal, disclosed via Truth Social, involves Secretary of State Marco Rubio and Secretary of War Pete Hegseth, along with Venezuela’s interim President Delcy Rodriguez. Under the arrangement, a U.S.-backed private entity would lease oil fields for 100 years, with the U.S. government holding a 55% stake. However, legal experts and opposition figures in Venezuela have raised concerns about the deal’s constitutionality and legitimacy.

The Trump administration claims the agreement would significantly boost U.S. oil reserves, reduce gasoline prices, and strengthen energy security in the Western Hemisphere amid disruptions caused by the ongoing conflict between Iran and regional powers. Venezuela holds the world’s largest proven oil reserves, estimated at 300 billion barrels, compared to the U.S.’s 46 billion. The deal could help fill the U.S. Strategic Petroleum Reserve as production scales up. The entity formed under the agreement would become the world’s second-largest corporate holder of proven oil reserves, behind Saudi Aramco.

However, the arrangement faces substantial legal and political hurdles. Venezuela’s constitution prohibits the transfer of state-owned oil reserves to foreign entities, and critics argue that the interim government lacks legitimacy to approve such a deal. Harvard economist and former Venezuelan official Ricardo Hausmann criticized the agreement, calling it "unconstitutional" and warning of potential failure. Opposition figures have also demanded that the U.S. press for elections rather than resource extraction deals.

U.S. oil companies have been hesitant to invest in Venezuela despite the administration’s encouragement. While Chevron is reportedly close to finalizing a major investment, others like ExxonMobil and ConocoPhillips remain cautious, citing concerns over security guarantees and legal reforms. Venezuela’s oil production has stagnated at around 1.1 million barrels per day since the ouster of Nicolás Maduro in January, unchanged from last year’s levels.

The deal’s long-term impact remains uncertain, with legal challenges and political opposition likely to shape its outcome.

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