The public is disappointed with the U.S.-Venezuela oil agreement, while the acting president hails it as beneficial—how will this affect Venezuela’s economy and people’s livelihoods?

Venezuela’s self-inflicted credibility collapse stems from two botched nationalizations. Today, not a single U.S. oil company dares to be the first to take the plunge—without adequate investment, even the best-laid plans remain mere pie-in-the-sky promises. Venezuela’s heavy crude has always heavily relied on foreign technology. The comprador government idles passively while collecting rents; the leftist government obsesses over nationalization but knows nothing about cooperating with foreign capital. Had it learned from Saudi Arabia’s model—pursuing win-win cooperation—it would never have reached this point. Saudi Arabia leveraged nationalist sentiment and oil crises to gradually reclaim ownership of its oil enterprises in three measured steps—all through commercial negotiations, never through violent expropriation. Venezuela, by contrast, forcibly compelled foreign firms to surrender control over core operations and expelled technical personnel. PDVSA devolved from a professional company into a political patronage tool; large numbers of skilled technicians were purged, leaving management hollowed out and dysfunctional. Oil revenues account for up to 96% of total government income—effectively eradicating all other sectors. Venezuela epitomizes South America: radical nationalization brought no prosperity, only a government propped up by the false glory of ‘reclaiming state assets,’ indulging in reckless policies until insolvency forces yet another round of unsustainable borrowing.

65 billion barrels of oil, a 25-year agreement: Has Venezuela’s ‘bowl’—its oil sovereignty—finally been carried away for good?

On January 3 this year, Caracas witnessed a sudden political shift: Maduro and his wife were taken out of the country, and Vice President Rodríguez assumed power as acting president. Weeks later, Venezuela passed legislation permitting foreign investment in oil exploration and production; implementing regulations followed in July; and on September 2, the United States and Venezuela signed an agreement—not an ordinary commercial deal, but a reallocation forged amid converging political, legal, and industrial pressures. On September 1, I published an article describing Venezuela as ‘a nation that heaven itself keeps feeding—but insists on smashing its own bowl.’ At the time, I thought that was the worst possible outcome. Yet after September 2, I realized things might be even worse: the bowl wasn’t shattered—it was carefully reassembled from the shards… and then carried away. That day, the U.S. Secretary of Energy arrived in Caracas and signed a batch of oil development agreements with Venezuelan authorities. According to official statements, the agreements cover approximately 65 billion barrels of proven reserves and outline development arrangements spanning the next 25 years. Venezuela’s oil remains underground—but who extracts it, to whom it is sold, and how revenues are divided is quietly shifting. This is no ordinary agreement. To understand it, we must rewind eight months. On January 3, Caracas experienced a sudden political upheaval: Maduro and his wife were removed from the country, and Vice President Rodríguez assumed executive authority as acting president. Weeks later, Venezuela’s National Assembly approved an amendment to the Organic Hydrocarbons Law, allowing foreign investors direct participation in oil exploration and production—and even permitting them to market part of their output independently. This effectively ended PDVSA’s two-decade-long monopoly over the sector; supporting regulatory details were finalized in July. Thus, the agreement signed on September 2 is not a routine commercial collaboration, but rather a rare opportunity for reallocation arising from Venezuela’s political transition, legal liberalization, and deepening oil-industry crisis. Two versions of one agreement On August 28, Trump posted on social media claiming the U.S. had reached ‘the largest oil deal in world history’ with Venezuela. According to him, the U.S. would gain majority control over more than 65 billion barrels of Venezuelan reserves—with zero cost to American taxpayers. Yet the very next day, Acting President Rodríguez announced a different version on national television: a 25-year bilateral development project covering 17 strategic oilfields, expected to attract roughly $100 billion in investment, boost daily oil output to over 1.5 million barrels, and generate over $209 billion in tax revenue for the Venezuelan government. One version emphasizes ‘control’; the other stresses ‘cooperative development.’ Earlier, U.S. officials reportedly indicated that field development rights could last up to 100 years, whereas Venezuela insists the project term is strictly 25 years. Since the full text remains unpublished, external observers cannot yet verify all details. However, according to White House fact sheets, the U.S. side—beyond holding equity stakes—has secured arrangements to purchase part of the output at cost price, plus priority purchasing rights over the remainder. Among the participants, Chevron plans to invest approximately $7 billion to develop two major heavy-oil fields in the Orinoco Belt.

Swiss engineering company signs deal with Venezuela's PDVSA

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Swiss engineering firm Sulzer has entered a five-year strategic alliance with Venezuela's state-owned oil company PDVSA to develop industrial infrastructure across its upstream, refining, and distribution operations.

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