Trump Says U.S. Has Deal for Control of Large Share of Venezuela’s Oil
By: Rebecca F. ElliottSimon Romero and Edward Wong (The New York Times)
Expanding in-ground oil reserves won't lower global oil prices. And increasing the amount of oil in the ground doesn't address the chokepoint of refinery capacity. How is this supposed to benefit the United States and American consumers?
A shady back-room deal with a private 'partner' will only boost stock value for the company. A deal like this one smacks more of corrupt self-interest than national interest. President Trump is exploiting America like many immigrants who only enter the country for the money. Trump may see himself as a modern day Robber Baron like the immigrant Andrew Carnegie but would be just another lie told badly.
S E E D E D C O N T E N T
President Trump said late Friday that the United States had struck a deal to take majority control of a huge portion of Venezuela’s oil reserves, pointing to a sweeping effort to assert U.S. dominance over energy in the Western Hemisphere.
The agreement amounts to a highly unusual foray into another country’s oil fields through a partnership with a private company, the State Department said through a U.S. official. The deal would give the United States control of more than 65 billion barrels of proven oil reserves, Mr. Trump said in a social media post. That is almost as much as all of the proven reserves in the United States, which is the world’s biggest oil producer.
Venezuela’s president, Delcy Rodríguez, called the agreement “historic” and said it would have a “significant impact on our nation’s revival.”
She said in a statement that the deal involved the development of 17 oil fields, more than $100 billion of investments and projected taxes of $209 billion for Venezuela’s strapped government, which has been struggling to improve living conditions after earthquakes in June left more than 6,500 people dead.
The aim of the deal, Ms. Rodríguez said, is “putting our immense reserves at the service of national development.”
Details were sparse, however, and the text of the agreement was not immediately available.
The Trump administration deposed and captured Ms. Rodríguez’s predecessor, Nicolás Maduro, in January, transforming a country that had been an adversary into something resembling a client state. As part of the process, the administration made Venezuela’s oil central to its campaign to expand U.S. influence over energy in the Americas, where rising production has helped blunt the loss of oil coming out of the Middle East over the past six months because of the Iran war.
Previous U.S. leaders often shied away from any suggestion that gaining sway over another country’s natural resources was a primary objective of U.S. military and foreign policy, wary of the international backlash, doubts over the legality of doing so and the potential for such moves to generate security threats against the United States.
But Mr. Trump and some of his top advisers have made it clear that oil is an important part of their foray into Venezuela.
Even before the removal of Mr. Maduro, American officials bluntly claimed that the United States had created Venezuela’s oil industry and that the country’s government had effectively stolen U.S. oil fields through nationalizations.
Unlike most other big oil powers, however, the United States does not have a national oil company through which it can make investments. Asked for comment, the State Department said through the U.S. official that the deal would in effect give the United States 55 percent of the output of a joint venture with an unidentified “experienced private operator in Venezuela.”
Oil exploration in Venezuela is generally conducted by the state-owned oil company, Petróleos de Venezuela, or through partnerships between it and private companies.
Mr. Trump made his announcement on Friday as Chevron, the second-largest U.S. oil company, was in advanced talks to significantly expand its operations in Venezuela, according to people familiar with the negotiations between the oil company and Venezuelan officials. That deal could be announced as early as next week.
Any new investment by Chevron, the only American company with a major presence in Venezuela, would bolster the country’s efforts to revitalize its ailing oil industry and its struggling economy.
Chevron’s negotiations over new investments in Venezuela were reported earlier by The Wall Street Journal.
Several other U.S. oil companies have also been pursuing opportunities in the South American country, though much of what has come to fruition so far this year has been preliminary or relatively small.
The Trump administration’s deal showcases the major shift underway in the energy landscape of Venezuela, which is thought to have the world’s largest oil reserves. Maintaining government control over oil has shaped the country’s politics for decades, and many Venezuelans view oil as a birthright and a cornerstone of national identity.
Under U.S. pressure just weeks after the capture of Mr. Maduro, Venezuela’s National Assembly approved an overhaul of legislation governing its oil industry, granting foreign oil companies greater control over their operations in the country. This move reversed much of Venezuela’s nationalization of oil projects in 2007 and opened the way for Chevron to expand its foothold.
The nationalization had been a pillar of Chavismo, the political movement created by Hugo Chávez, Mr. Maduro’s predecessor, which wielded control over Venezuela until this year.
Ms. Rodríguez, a Maduro ally who replaced him as president, has faced U.S. threats that she could meet a similar fate. She has been much more open to working with the U.S. government and frequently talks to and meets with top Trump administration officials.
Anatoly Kurmanaev and Lisa Friedman contributed reporting.
Rebecca F. Elliott covers energy for The Times.
Simon Romero is a Times correspondent covering Mexico, Central America and the Caribbean. He is based in Mexico City.
Edward Wong reports on global affairs, U.S. foreign policy and the State Department for The Times.
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President Trump seems to believe that Americans are too stupid to understand when they're being cheated. That seems to be a common trait among immigrants who are only here for the money. These types of shyster migrants game the system to their advantage and leave taxpayers holding the bag.
How do you imagine Americans are being cheated by this ?
American consumers won't benefit from this deal. Selling 65 billion barrels of oil at todays prices would generate less than $6 trillion in revenue. That wouldn't even cover the current fiscal year budget. The tax revenue from producing the entire reserve wouldn't pay for one year's defense budget.
An oil company's reserves determines its value. This deal will only boost the stock price of a private oil company. There's actually more value in not producing the oil to manipulate stock prices. Whoever owns stock in this unnamed company will see an immediate windfall. But controlling reserves won't lower the price of oil and gasoline.
Not totally. There are other factors. (For example the actual expense in getting it out of the ground. In addition, the relative cost in refining it).
So you are defining "a benefit" as solving the deficits. Okay. By that standard, nothing, ever, will "benefit" the American consumer.
But controlling reserves won't lower the price of oil and gasoline.
Yes, it does because stability and access to supply matters. Is is really that hard to understand why you don't want foreign cartels controlling access to vital resources?
Those consumers who own stock in certain oil companies can benefit bigly!
Isn't that how Republicans have measured benefit to Americans over the last 40 years?
Stability and access are important for valuation and balance sheet of the oil company. Converting this oil deal to a price-at-the-pump benefit will require years of investment to produce the field and construct refining capacity that can process this particular oil.
How does owning property that cannot be collateralized benefit consumers?
I don't know of any Republican who opposed something that would benefit America simply because it didn't solve the entire deficit issue in one fell swoop.
Stability and access are important for valuation and balance sheet of the oil company.
And, you know, the entire American economy.
onverting this oil deal to a price-at-the-pump benefit will require years of investment to produce the field and construct refining capacity that can process this particular o
As I said, this is long term strategic thinking. This is what we should want from our leaders, not governance by daily polling.
True.
Venezuelan Crude is generally considered to be a last resort.
It looks like mud.
It has the viscosity of mud and require special treatment to pump and transport.
it also requires special refineries.
unlike better oils, 50% of the original quantity is basically filtered away as dirt.
Grade of Venezuelan Crude Oil
Venezuelan crude is primarily heavy and sour , with most of the country’s production falling into the heavy crude category, and some grades classified as extra heavy .
Key characteristics:
API Gravity: Most Venezuelan crude grades are below 20° API, with flagship blends like Merey 16 around 15.9° API , placing them firmly in the heavy crude range Visual Capitalist +1 . Some Orinoco Belt extra-heavy grades (e.g., Boscan) are even below 10° API Visual Capitalist .
Sulfur Content: High, typically 2.5–3.4% sulfur , classifying it as sour crude
www.shale24.com .
Viscosity: High, requiring diluents or special handling for transport and refining
www.shale24.com .
Other Properties: Contains elevated levels of vanadium (300–400 ppm) and nickel, which can damage refinery catalysts
www.shale24.com . It yields a high proportion of heavy residues (>50%) suitable for coking, but lower volumes of lighter fractions like naphtha and gasoline 
www.shale24.com .
Examples of Venezuelan crude grades:
Merey 16 – Heavy sour, ~ 15.9° API, high sulfur Visual Capitalist +1 .
Hamaca – Heavy sour, ~ 17° API Visual Capitalist .
Boscan – Extra heavy sour, ~ 10.1° API Visual Capitalist .
Mesa 30 – Medium sour, ~ 29.1° API Visual Capitalist .
Why it matters:
The Guardian .
Because of its high density and sulfur content, Venezuelan crude is best suited for complex refineries equipped with coking and desulfurization units. This makes it attractive to certain markets, such as parts of the US Gulf Coast, which have heavy crude processing capacity
In summary, Venezuelan crude is mostly heavy to extra-heavy sour oil , with API gravities generally below 20°, and some grades below 10°, making it a challenging but valuable feedstock for specialized refineries.
Many immigrants have lived in dire poverty in their native countries. And many come here for the opportunity to work hard and act wisely to both better their own lives as well as contribute greatly to the country as a whole.
(If anyone doubts that there have been many, many immigrants who have both bettered their own economic status as well as having made great contributions to the U.S, I suggest you google it).
I can also Google instances where immigrants only came to the US to game the system and obtain money to meet a financial goal. Political incentives reward migrant inflow; there's no political incentive to track outflow so that's largely ignored. My premise that immigration is actually an economic issue can be tested by following the money. At present migrant remittance (transferring money out of the country) amounts to $150-$200 billion each year. And that misses the unrecorded, informal outflow of outflow of money. You can Google that.
Fantastic. If he pulls thus off, will make his foreign policy record will be the best in decades for an American president.
1. Iran neutered and the straight of Hormuz becoming irrelevant as a deterrent. More pipelines and a new Channel being built will make the straight much less important. Iran could play that card once. They did and the world has reacted.
2. A secure supply of Venezuelan oil will make the mid east essentially irrelevant to American security. We can just leave.
Promises of future oil abundance will not overcome the immediate crisis posed by the Straight of Hormuz. The Persian Gulf states are furiously building pipelines to bypass the Straight to provide global access to oil. Saudi Arabia has already brought significant pipeline capacity and Red Sea oil terminals on-line. The UAE and Qatar are working to construct pipelines to bypass the Straight. Even Iran has been utilizing its oil terminal south of the Straight. But constructing pipelines to move oil does not address the other commodities trapped in the Persian Gulf.
The United States may not need Persian Gulf resources. But the interruption of the flow of Persian Gulf commodities has raised global prices that directly impacts American consumers. That's a big problem with a globalized economy. Abundance and availability of resources doesn't necessarily lower prices that benefit consumers. Trump trying to move pieces around the globalization game board really won't correct the underlying problem.
Promises of future oil abundance will not overcome the immediate crisis posed by the Straight of Hormuz.
Literally the whole point is to remove the straight of Hormuz as a crisis point that Iran can point as a dagger at our throats us whenever it wants.
The Persian Gulf states are furiously building pipelines to bypass the Straight to provide global access to oil. Saudi Arabia has already brought significant pipeline capacity and Red Sea oil terminals on-line. The UAE and Qatar are working to construct pipelines to bypass the Straight.
yes, exactly. These things benefit America, much like control of more Venezuelan oil does.
Trump trying to move pieces around the globalization game board really won't correct the underlying problem.
Perfect is the enemy of the good. More oil from Venezuela, and control over it, is undoubtedly good for American consumers and American Economic security. That is does not solve all the world’s problems does not mean it’s not a massive improvement over the status quo.
[✘]
Colonialism never works in the long run, but lets face it, Trump has no interest whatsoever in the long run.
Yeah.. It was such so better for Venezuelans when they gave oil for free to Cuba and sold it to China at a discount in the name of ideological loyalty. Now they'll have billons more to put in their sovereign fund .
And yes colonialism almost always worked in the long run. It's often the short run where the suffering occurred. But this, of course, isn't colonialism.
Trump has no interest whatsoever in the long run
This is, pretty much in it's entirety, a long run play. That's the whole point. Much like the Iran strategy is short term problems (higher gas prices) for a long term gain (the removal of Iran as dominating the mid east and global energy markets._
Colonial rule has worked so well that as time passes, more and more independent countries have come under colonial rule!
When one country takes over the natural resources of another country that is colonialism.
It often works well for a small group of the colonizers who fuck the shit out of the country, strip it of its resources, funnel the resources through their own private industries that they can personally profit off of and then live like Emperors on the backs of the subjugated people until decades or centuries later when the people finally rise up and overthrow the despotic piece of shit colonizers.
Yeah,, it sucks to have infrastructure built, access to modern medicine, education etc.. countries were much better off without them
All things that can be shared through partnerships and treaty's or traded for without the need to conquer and subjugate them.
What they get under colonization is that the colonizer takes $100 billion in the nations resources and gives the people a million-dollar hospital that can only serve a small fraction of the nation's populace.
So China is currently colonizing Africa. Got it.
You want to think that through? I'm sure you can spot the massive problem in your glib drive by if you try.
what is your point ?
I read a story this morning about how one of the men helping set up these oil deals in Venezuela has been under criminal investigation (in Europe) for years, for money laundering and is associated with crimes of fraud.
This begs a elephant in the room question - who can trust Trump to do anything except what is in his own personal financial interest? Sure, maybe he could, but it cannot be trusted.
There is going to be such a shit show to clean up once he is gone it will take years and years.
That by your definition, China is colonizing Africa right now. Why doesn't that bother progressives given their obsession with anti-colonialism? They obsess over things that happened hundreds of years ago while ignoring actual, ongoing colonization? Bizarre behavior.
Like Trump is doing with Venezuela.
American's responsibility is much more to address what their own country does.
I am not in favor of any exploitative colonization, in Africa or anywhere else.
I'm curious. Do you have absolute faith this oil grab will not personally benefit the Trump family in any way ?
America's responsibility is to American Citizens first
If people believed that we wouldnt have a criminal president.
It happens so infrequently that when he does it's seems like it's almost an accident. This is not a win for the US taxpayer.
And that has been going on way before Trump.
If it helps Americans and lowers gas prices I don't care
Of course it probably will. Politicians, and their families and friends , almost always personally benefit from the policies they implement.
[✘] But its undoubtedly good for America.
The infrastructure is so old and decayed the US companies don't want to touch it. To get that oil out of the ground won't happen unless Trump get's his Congressional ball-lickers to subsidize the cost of modernization.
Venezuela pumps a million barrels a day [✘] Any oil company that isn’t run by liberal fuktards will be lining up for their share of the pie.
Hmm... weird... Venezuela has 17% of the world's oil reserves, but only manages to produce 1%. The damage is well documented and the CEO of the largest US oil company is on the record saying Venezuela is "un-investable". I think it's the MAGA ball-licking sycophants that are TDS ignorant, if they think that oil companies are going to line up to spend their own billions to lower their profit margins.
[ ✘ ]
Your point is trolling.
Here you go:
Sorry to disappoint you on the humorous timeline.
Note that ExxonMobil US is the largest US oil company today.
Here's another - It's a little older from way back
Perhaps it will make you laugh.
I included the last part on purpose to reflect my original point. Who's going to foot that bill to fix the infrastructure?
The above link came from this AP Article published today:
It says:
I'm not going to laugh at the MAGA TDS that makes everything the clown in the Oval Office pukes up possible. I'm going to laugh at them every time they complain how expensive everything still is going into Christmas.
Once the elections are over Trump wont care as much as he does now. He thinks this a great selling point for his administration.