US President Donald Trump has announced an oil agreement with Venezuela that he described as the “biggest oil deal in world history”, giving the United States majority control over more than 65 billion barrels of proven Venezuelan oil reservesTrump said the agreement was negotiated by Secretary of State Marco Rubio, Defense Secretary Pete Hegseth and Venezuela’s interim President Delcy Rodríguez. He said the arrangement was reached through a partnership with private business and would come at no cost to American taxpayers.

What the Venezuela oil deal involves

According to Venezuelan officials, the agreement covers the development of 17 oil fields with a proven potential of around 65 billion barrels. Caracas said the project could attract about $100 billion in private investment and generate more than $209 billion in tax revenue for the Venezuelan governmentA US official familiar with the agreement said the United States would work with an unnamed private operator to establish a new company. The arrangement reportedly gives the venture 100-year rights to develop the oil fields, while the US would have a 55% effective share of the output, including an ownership stake and rights to purchase oil at cost.

However, the full structure of the deal, including the private companies involved and how US control will be exercised, has not yet been publicly disclosed.

Trump links deal to lower US fuel prices

Trump has claimed that the agreement will more than double US oil reserves, increase supplies and substantially reduce gasoline prices for Americans.The announcement comes as the US faces continued pressure over fuel prices. The ongoing Iran conflict has disrupted global oil flows, while the US Strategic Petroleum Reserve has also fallen sharply this year.US Secretary of State Marco Rubio said the agreement would bring substantial private investment to Venezuela while providing a stable source of lower-cost oil for the United States.

Why Venezuela’s oil reserves matter

Venezuela holds an estimated 303 billion barrels of proven crude oil reserves, the largest such reserves in the world, according to the US Energy Information Administration. Yet years of underinvestment, sanctions and deteriorating infrastructure have left the country's production far below its potential.That means the agreement could be strategically significant for Washington, but it is unlikely to translate into a rapid increase in Venezuelan oil production. Rebuilding damaged infrastructure and expanding output would require substantial investment and could take years.

Deal follows dramatic US-Venezuela shift

The announcement marks another major step in the dramatic change in US-Venezuela relations following the removal of former Venezuelan President Nicolás Maduro earlier this year.Trump's administration has since pushed for greater private investment in Venezuela's energy sector. Rodríguez also moved to open the country's oil industry to greater private participation after taking power.The deal could now face scrutiny over its legal and political implications in Venezuela, where the state has historically retained control over the country's oil resources. Questions also remain over the identity of the private partners and the practical timeline for increasing production.