The United States and Venezuela Reach 25-Year Oil Agreement, Targeting 1.5 Million Barrels per Day

The United States and Venezuela have signed a large-scale 25-year oil cooperation agreement, aiming to boost Venezuela’s daily crude oil output to 1.5 million barrels, involving the development of 17 strategic oilfields with investment exceeding $100 billion. This is the most significant economic engagement between the two countries in decades, and a key step for the Trump administration to reshape its foreign policy toward Venezuela through energy interests.

According to Xinhua News Agency, Venezuela’s acting president Delcy Rodríguez announced on the 28th that the country had reached a large-scale oil cooperation agreement with the United States, which will allow private companies to participate, thus significantly increasing oil production and bringing in over $209 billion in tax revenue for the Venezuelan government. Trump also posted on social media that the United States had obtained “majority control” over more than 65 billion barrels of Venezuela’s proven oil reserves.

According to a Reuters report on August 30, Rodríguez described the agreement as “historic” in a late-night address on national television, saying it would help revitalize Venezuela’s economy and increase government revenue. She stated that approximately $19 per barrel would flow directly into Venezuela under the agreement, while emphasizing that Venezuela would retain “ownership and sovereignty” over its natural resources. However, according to Bloomberg, the agreement has triggered a strong backlash from both ends of Venezuela’s political spectrum, angering both hardline Chavistas and the opposition.

Core Terms of the Agreement: 25-Year Framework, Daily Target of 1.5 Million Barrels

The agreement is reported to last 25 years, with the core objective of raising Venezuela’s crude oil daily output to over 1.5 million barrels. Rodríguez said this output is merely the preliminary target under the bilateral framework, and broader plans include the development of eight new exploration blocks as part of the overall expansion of Venezuela’s energy sector.

The agreement covers the development of 17 strategic oilfields, with investment exceeding $100 billion. At a benchmark oil price of $65 per barrel, the agreement is expected to bring around $209 billion in tax revenue to Venezuela, with about $19 per barrel flowing directly into the government. Rodríguez also acknowledged that actual returns would fluctuate with oil prices.

Citing two sources, Reuters reports that Chevron is expected to finalize negotiations first, incorporating its joint ventures in Venezuela into the country’s energy sector framework. Venezuelan officials are preparing to sign the agreement next week, granting new oil exploration and production rights to several enterprises, including American companies.

Venezuela possesses the world’s largest proven oil reserves, but years of underinvestment, mismanagement, and sanctions have left current output at roughly 1.25 million barrels a day, far below its potential capacity. The report notes that, in announcing the agreement, Trump stated that U.S. companies would help revive the South American country’s energy industry and provide a new source of crude for the U.S., helping to lower domestic fuel prices.

Political Risk: Agreement Faces Criticism from Both Sides Within Venezuela

According to Bloomberg, the agreement has sparked strong backlash on both ends of Venezuela’s political spectrum.

Hardline Chavistas criticized Rodríguez for selling out national sovereignty, questioning the agreement’s legitimacy in private discussions and on social media, claiming it was a concession forced under U.S. threats.

Former leftist lawmaker Willian Rodríguez quoted the late President Chávez, directly denouncing the deal for “abandoning the motherland.”

The opposition also takes a critical stance, but for different reasons. According to Bloomberg, opposition leaders were not involved in the negotiations, with the most influential opposition leader, María Corina Machado, excluded throughout. Opposition member José Amalio Graterol stated that any agreement signed by Rodríguez “has no effect,” because she “lacks original legitimacy.”

Risa Grais-Targow, Director for Latin America at Eurasia Group, pointed out that the agreement may produce a dual effect for Rodríguez:

On one hand, it reinforces the Trump administration’s willingness to work with her, possibly weakening Washington’s motivation to push Venezuela to hold elections soon; on the other, the political sensitivity surrounding resource nationalism makes the deal a political burden for her.

“That’s exactly why the opposition is so angry,” she said.

Additionally, the agreement’s economic terms have also attracted professional skepticism. Francisco Monaldi, Director of the Latin American Energy Policy at the Baker Institute for Public Policy at Rice University, said that the $209 billion in tax revenue cited by Rodríguez, spread over 6.5 billion barrels of oil, amounts to only about $3.20 per barrel, and if the present value over the project’s lifetime is considered, the real value would be lower. He said that the lack of transparency in Venezuela’s oil policy “is very concerning.”

Geopolitical Game: The Agreement May Reshape U.S.-Venezuela Relations

Political analyst Benigno Alarcón noted that the oil deal opens a new geopolitical logic: as U.S. companies commit billions in investment to Venezuela, Washington’s policy focus may gradually shift from demanding an “orderly transition” to maintaining “stability favorable to American economic interests.”

Grais-Targow also pointed out that the agreement may reduce the Trump administration’s motivation to pressure Venezuela’s electoral process, a concern that has already worried some opposition figures who believe the deal will consolidate Rodríguez’s power.

Rodríguez now faces multiple pressures: her polling numbers dropped after the government’s slow response to two deadly earthquakes in June this year (which killed over 6,500), and she must also balance increasingly close ties with the U.S. against a decades-old domestic political movement founded on resource nationalism and anti-U.S. positions.