Venezuela's Rodríguez Details 25-Year Terms of US Oil Deal as Trump Says Proceeds Will Refill a Near-Empty Reserve

Since President Trump announced the U.S.-Venezuela oil partnership on Friday, August 28, calling it the "biggest oil deal in world history," the actual terms have started coming into focus over the weekend. They are messier than the initial announcement suggested.

Venezuela's interim President Delcy Rodríguez laid out specifics in a televised address Saturday night, according to Reuters reporting carried by the Daily Signal. The deal runs 25 years. It covers 17 "strategic oilfields" with an initial production target of 1.5 million barrels per day, up from Venezuela's current output of about 1.25 million bpd. A separate plan adds eight greenfield oil blocks.

Rodríguez put a number on what Venezuela stands to gain: roughly $209 billion in state revenue, based on a $65-per-barrel benchmark, with about $19 of every barrel produced and sold under the arrangement flowing directly to Caracas. "The benefits are endless," she said, according to The Guardian, insisting Venezuela retains "ownership of and sovereignty" over its resources.

What the U.S. actually gets

The U.S. share is 55% of oil from a joint venture with an unnamed private Venezuelan company, according to an official who spoke to NPR on condition of anonymity because they weren't authorized to discuss the deal publicly. That 55% is tied to an estimated 65 billion barrels of Venezuela's roughly 303 billion barrels in proven reserves, the largest in the world, ahead of Saudi Arabia's 268 billion and Iran's 208 billion, per Guardian figures.

Trump has said the U.S. will take its stake "at cost." On Truth Social Sunday, he wrote that the oil will go toward refilling the Strategic Petroleum Reserve, which he said Joe Biden left "virtually" empty. Al Jazeera reports the SPR held about 290 million barrels as of August 21, near a 44-year low, after drawdowns under both the Biden and Trump administrations tied to the Ukraine war and the ongoing U.S.-Israel conflict with Iran.

Why energy economists are skeptical

Trump says the deal will lower gas prices. Multiple energy specialists interviewed by NPR and TPR say that claim doesn't hold up structurally, whatever happens eventually with supply.

Paasha Mahdavi, a political science professor at UC Santa Barbara who studies the oil industry, told NPR his first reaction was "wow, this is crazy," but on closer inspection "this may not actually do anything." His concern: an "at-cost" arrangement removes the profit incentive that normally draws investors into volatile, high-risk plays. "'At cost' is not attractive in this industry," Mahdavi said.

Francisco Monaldi, director of the Latin America Energy Program at Rice University's Center for Energy Studies, called it "extremely unusual" for the U.S. government to become a shareholder in an oil venture at all, since Washington, unlike Saudi Arabia or Mexico, has no state-owned oil company. Gerald Kepes of Competitive Energy Strategies raised the practical question nobody has answered yet: "who's going to operate on the ground?"

There's also a timing problem. Al Jazeera notes the deal "will require significant investment and infrastructure work before production can rise substantially," meaning any effect on U.S. pump prices is not close. Years of sanctions, underinvestment and mismanagement are why Venezuela, despite having the planet's largest reserves, produces a fraction of its potential today.

The legitimacy question the deal can't avoid

Rodríguez has been in power since January, when Trump ordered a special forces raid that captured President Nicolás Maduro, who is now jailed in New York, according to Breitbart. Rodríguez was never elected to the presidency. Kepes told NPR that fact complicates any deal's long-term durability, since it rests on the continued cooperation of a government that came to power through U.S. military action rather than a vote.

The Guardian reports the deal has "provoked outrage" both among opposition figures and within Rodríguez's own Chavista movement, even as pro-government groups staged protests in Caracas against the broader U.S. presence in the country. It is a fair question whether a government installed by an American raid can strike a 25-year resource deal that Venezuelans across the political spectrum will accept as legitimate over time. Rodríguez's answer, on state television, is that sovereignty is preserved and the deal is Venezuela's own choice to convert underground wealth into "development."

None of the sources here identify who the private Venezuelan company in the joint venture is, or which American firms might take a piece of the U.S. government's stake. Reuters reports Venezuelan officials are preparing to sign additional exploration and production agreements with several companies, including U.S. firms, in the coming week. Those signings, and whatever operator eventually gets named, will be the next concrete marker of whether this deal produces actual barrels or just a headline.