Scoop: U.S. close to striking "massive" deal for Venezuelan oil fields
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The Trump administration is in talks with Venezuela's interim government about taking an ownership stake in the South American country's enormous oil resources, two U.S. officials tell Axios.
Why it matters: The historic deal would more than double U.S. oil reserves by drawing from a country that has the world's largest proven reserves.
- "Calling this deal huge would be an understatement," one of the officials said. "It is massive."
- Adding pressure to get the deal signed: the wars in Iran and Ukraine, which have disrupted global oil supplies and raised prices.
- The U.S. Strategic Petroleum Reserve is now at a 40-year low.
Zoom in: Details are still being hammered out, but the discussions involve more than a dozen productive oil fields — not all of Venezuela's 300 billion barrels of proven reserves.
- The fields in question, which have 90 billion barrels of proven reserves, used to be controlled by former Venezuelan insiders — including some who've been indicted — as well as interests once controlled by China, the official said.
- In return for giving the U.S. an ownership stake, Venezuela's government would benefit from private companies, including American firms, developing the fields and returning more oil revenue to that country.
Zoom out: The Venezuelan oil deal would be a legacy-defining moment for President Trump, who has made U.S. energy security and dominance in the Western Hemisphere pillars of his so-called "Donroe Doctrine."
- "President Trump is close to securing America's energy future for generations to come, not just in the U.S. but in the hemisphere," a second official said.
- Trump began privately discussing ways to have an ownership stake in Venezuelan oil fields even before he authorized the Jan. 3 capture of Venezuelan strongman Nicolas Maduro, who faces narco-terrorism charges in New York.
- Venezuela's oil sector fell into a relative state of disrepair because of the legacy of socialist mismanagement by Maduro and his predecessor, Hugo Chavez, after he took over in 1999.
Behind the scenes: The talks have been spearheaded by U.S. Secretary of State Marco Rubio and Venezuela's acting president, Delcy Rodriguez.
- Last month, top officials from the State and Defense departments met with their counterparts in Caracas to discuss more of the specifics.
- Deputy White House Chief of Staff Stephen Miller is also playing a major role.
- The administration is sensitive to accusations that Rodriguez would be giving away Venezuela's natural resources to the U.S., one official said, so "we're going out of our way to show how this will benefit the people of Venezuela, because it will."
What's next: The exact timing for finalizing the deal is unclear, but Energy Secretary Chris Wright has been discussing plans to go to Venezuela next week as his department discusses ways to increase oil production by U.S. firms.
