Donald Trump announced on Friday, August 28, that the United States has taken control of Venezuela’s oil reserves. According to the US president, Washington has concluded an agreement with Caracas for what he calls “the most important oil contract in world history.” The Venezuelan government confirmed the “historic agreement” an hour later through interim President Delcy Rodriguez.
To begin with, the agreement gives the United States majority control of more than 65 billion barrels of Venezuela’s proven oil reserves. According to Trump, this doubles US oil reserves at no cost to American taxpayers. Furthermore, he stated it would substantially reduce fuel prices for Americans while helping Venezuela achieve “immense success and great prosperity.”
The announcement comes after Trump achieved success in Venezuela by removing President Nicolas Maduro in January without losing military forces. However, Trump is now entangled in the Iranian conflict, which he triggered in late February. As a result, the Strait of Hormuz has been blocked, disrupting global oil supplies. In addition, Washington has entered an unprecedented trade war with Canada, one of the US crude suppliers.
Consequently, the agreement is seen positively as it could relieve the oil sector. The average price of a gallon of gasoline is currently $4.09 in the United States, two months before the midterm elections. For example, this is better than the $5 reached during the 2022 Ukraine war. Nevertheless, it remains above the $3.10 price when Trump returned to the White House in January 2025.
According to a White House official cited by the Financial Times, Washington obtained 55 percent of the effective production of a new joint venture. This venture would become the second largest private oil company in the world in terms of reserves, after Saudi Aramco. Furthermore, the project would benefit from 100-year concessions on fields totaling 65 billion barrels of proven reserves.
The legality of these concessions is not formally established. Trump had accused Venezuela of expropriating US oil during nationalizations in the 1970s and under Hugo Chavez. After taking power, Delcy Rodriguez enacted a law opening the oil sector to privatization, reversing a fundamental principle of Chavez’s policies.
However, Venezuela’s facilities are in such disrepair that it produces only 1 percent of global oil, despite having 17 percent of proven reserves. Major oil companies are willing to extract oil, but they are cautious about future investments given that hydrocarbons are threatened long-term.
Furthermore, the agreement is not welcomed by everyone, especially in the Venezuelan opposition. Ricardo Hausmann, a former minister before Chavez and now a Harvard professor, stated on X that the interim government has no legitimacy to conclude this unconstitutional agreement, calling it “a fiasco for all parties involved.”
Reference
Le Monde, “Donald Trump annonce la mainmise des Etats-Unis sur le pétrole du Venezuela,” published August 29, 2026. https://www.lemonde.fr/international/article/2026/08/29/donald-trump-annonce-la-mainmise-americaine-sur-le-petrole-venezuelien_6759434_3210.html