Trump says Venezuela is handing over $2 billion worth of oil to the US, a step that could reduce supplies to China
The agreement suggests that the Venezuelan government is reacting to Trump’s warning to allow U.S. oil firms access or face the threat of increased military action.
Donald Trump has said that Venezuela will “hand over” $2 billion worth of Venezuelan crude oil to the United States, a major deal that would divert supplies away from China and help Venezuela avoid further cuts to its oil production.
“This oil will be sold at market price, and I, as President of the United States of America, will control the money to make sure it is used for the benefit of the people of Venezuela and the United States!” Trump said in an online post.
Venezuelan government officials and the state-owned oil company PDVSA did not comment.
Millions of barrels of oil are sitting in Venezuelan tankers and storage tanks, unable to be shipped due to a blockade imposed under Trump’s pressure campaign. This blockade culminated in the defeat of Nicolás Maduro, who was apprehended by US forces in his country over the weekend.
Top Venezuelan officials have called Maduro’s arrest a kidnapping and accused the US of attempting to steal the country’s vast oil reserves; however, Tuesday’s agreement is a strong indication that the government is responding to Trump’s demands that they open their doors to American oil companies or risk further military intervention.
Trump has said he wants interim president Delcy Rodríguez to grant the US and private companies “full access” to Venezuela’s oil industry.
Trump said that U.S. Energy Secretary Chris Wright is in charge of finalizing the deal and added that the oil would be taken from tankers and sent directly to U.S. ports.
Two sources told Reuters on Tuesday that the U.S. may initially have to reroute cargoes originally bound for China to secure the stranded crude oil supply.
China has been Venezuela’s largest buyer over the past decade, especially since the U.S. imposed sanctions on companies involved in oil trade with Venezuela in 2020.
Following Trump’s announcement, U.S. crude oil prices fell by more than 1.5%, and the agreement is expected to increase the volume of oil exported from Venezuela to the U.S.
That oil flow is currently entirely under the control of PDVSA’s main joint venture partner, Chevron, and is operating under U.S. authorization.
Chevron, which is exporting 100,000 to 150,000 barrels of Venezuelan oil to the U.S. daily, is the only company that has been able to load and ship crude oil from the South American country without interruption during the blockade in recent weeks.
It was not immediately clear whether Venezuela would have access to the revenue from the supplies.
The sanctions mean that PDVSA has been cut off from the global financial system, its bank accounts have been frozen, and it is prevented from conducting transactions in US dollars.
Hours before Trump’s announcement on Tuesday, Rodriguez struck a defiant tone against the US, saying in a televised address that “no foreign agent governs Venezuela” – a clear response to the US president’s claim that, after Maduro’s capture, the US would now be running the South American country.
This marked another shift in tone for Maduro’s former vice president. After being sworn in as president by Venezuela’s Supreme Court on Saturday, Rodriguez issued a conciliatory statement late Sunday inviting the “US government to work together on an agenda of cooperation.”
But in Tuesday’s speech, Rodriguez used even harsher language, describing Saturday’s raid – the first large-scale US military operation on South American soil – as a “terrible military attack” and a “criminal attack,” the “completely illegal consequence of which, in violation of international law,” was the “kidnapping” of Maduro and his wife, Cilia Flores.
“We are people who do not surrender, who do not give up, and we are here, governing together with the people. In our country, the Venezuelan government governs – no one else. No foreign agent governs Venezuela. It is Venezuela, its constitutional government, and the united strength of the people,” said Rodriguez, who had been Maduro’s vice president since 2018.
According to Reuters sources
