Don’t Be Fooled by the U.S.–Venezuela Oil Deal: It Looks Like a Windfall, but Is Actually Just Expectation-Driven Hype and Political Calculus

You’ve probably noticed the recent news about Venezuela’s oil cooperation with the United States—many online users are angrily branding Venezuela’s current government as 'traitors to Venezuela,' while others believe the U.S. has once again seized a massive advantage. According to CCTV News, Venezuela’s interim President Rodríguez confirmed on the 28th that her country had reached a petroleum cooperation agreement with the United States, covering the development of 17 strategic oilfields. The agreement will last for 25 years, with a target of raising crude oil output to 1.5 million barrels per day. If you stop reading here, it may seem like Trump has scored an overwhelming victory—but hold on, and read further. According to Rodríguez, the agreement permits private-sector participation, thereby substantially boosting oil production. It stipulates development of the 17 strategic oilfields, with investments exceeding $100 billion, and is projected to generate over $209 billion in tax revenue for Venezuela. Notice something? Though these figures look impressive, they remain purely aspirational—'pie-in-the-sky' promises. This is essentially no different from Trump’s demands that Japan and South Korea invest $550 billion and $350 billion respectively: both are exercises in 'expectation management.' Recall that the U.S. finalized its investment agreements with Japan and South Korea last July. A full year later, less than $300 billion worth of deals have been formally signed—and only $2.2 billion has actually materialized on the ground. Given this context, how much funding do you think will truly materialize from the U.S.–Venezuela agreement? So whether Trump can even achieve his stated goals remains highly uncertain—let alone claim outright 'victory.' Hence, when numerous self-media accounts proclaim 'a massive U.S. win' or 'a crushing Chinese defeat,' take them with a grain of salt. Then why did the U.S. publicly announce this massive energy agreement with Venezuela right now? For Trump, there are three main objectives: First, to undermine Iran’s resolve to resist—and accelerate internal fragmentation within Iran. Yesterday I noted that Iran’s hardliners failed to deliver proportional countermeasures across four separate tests—signaling that Iran’s entire decision-making apparatus still clings to illusions about the alluring terms of the memorandum, thus conceding—or retreating. Now, the Venezuela news serves to further sow discord inside Iran, sending a message to Iranian capitulationists and centrists: 'After Maduro was kidnapped and knelt, Venezuela’s current government is feasting and reveling. Follow their example—oust Mojtaba, and you too can retain your privileges in the future.' Second, domestic U.S. political infighting necessitates this move—comprising three sub-objectives. First, stabilizing oil prices. Due to the U.S.–Iran conflict, American citizens are increasingly vocal in their complaints about soaring domestic fuel prices. Announcing the Venezuela energy deal deflects public anger away from Trump. If prices fall later, it’s Trump’s achievement; if they don’t, responsibility falls squarely on the operating companies and Venezuela’s current government—Trump, after all, has 'done his part.' Second, providing a plausible justification for the U.S.–Iran war. When Trump orchestrated Maduro’s abduction, his calculation was that U.S. energy giants would enter Venezuela and thereby rally behind him. But the plan backfired: major U.S. energy firms—including Chevron, ExxonMobil, and ConocoPhillips—refused to play along. Rather than expressing gratitude, they politely declined, citing historical risks and unfavorable current investment conditions.

65 Billion Barrels of Oil, a 25-Year Agreement: Has Venezuela’s ‘Bowl’ Really Been Carried Away This Time?

On September 1st, 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 2nd, I realized things might be even worse: the bowl wasn’t merely shattered—it was painstakingly reassembled from the fragments… and then carried off. 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, who buys it, and how revenues are distributed is quietly undergoing transformation. This is no ordinary agreement. To understand it, we must rewind eight months. On January 3rd this year, Caracas experienced sudden political upheaval: Maduro and his wife were removed from the country, and Vice President Rodríguez assumed power as interim president. Within weeks, Venezuela’s National Assembly passed an amendment to the Organic Hydrocarbons Law, permitting foreign direct participation in petroleum exploration and extraction—and allowing foreign operators to sell part of their output independently. This effectively ended PDVSA’s two-decade-long monopoly over Venezuela’s oil industry. Supporting regulatory details were finalized in July. Thus, the agreement signed on September 2nd is not a routine commercial partnership, but rather a strategic reallocation opportunity arising from the confluence of Venezuela’s political transition, legal liberalization, and deepening crisis in its petroleum sector. One Agreement, Two Versions On August 28th, Trump posted on social media claiming the U.S. and Venezuela had concluded 'the largest oil deal in world history.' Per his account, the U.S. would gain majority control over more than 65 billion barrels of Venezuelan reserves—with zero cost to U.S. taxpayers. Yet the very next day, Venezuela’s interim President Rodríguez announced a markedly different version on national television: a 25-year bilateral development project involving 17 strategic oilfields, aiming to attract roughly $100 billion in investment, lift daily output above 1.5 million barrels, and generate over $209 billion in tax revenue for Venezuela’s government. One version emphasizes 'control'; the other stresses 'cooperative development.' Earlier, certain U.S. officials reportedly hinted that development rights for some fields could extend up to 100 years—while Venezuela insists the term is strictly 25 years. Since the full text remains unpublished, external observers cannot yet verify all details. But 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. Chevron, for instance, plans to invest around $7 billion to develop two large heavy-oil fields in Venezuela’s Orinoco Belt—a vital infusion for a country long starved of capital and technical expertise, and a pivotal opportunity for the U.S. to re-enter Venezuela’s petroleum industry. What does '65 billion barrels' actually mean? Venezuela’s proven oil reserves stand at approximately 303 billion barrels—the world’s largest.

Venezuela Targets Nearly $76 Billion Oil Investment Over Five Years

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Venezuela aims to secure nearly $76 billion in oil and gas investment over five years to revive production, per Acting President Delcy Rodríguez. Major firms like Chevron are involved, though infrastructure and political challenges remain significant obstacles.

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