Talks are under way between the U.S. administration and Venezuela’s interim government over a possible arrangement concerning the country’s oil resources. The proposed arrangement would give the United States an ownership stake in Venezuelan oil fields.
Axios reported that the talks cover more than a dozen production fields. The fields hold approximately 90 billion barrels of proven oil reserves, while Venezuela’s total proven reserves stand at roughly 300 billion barrels.
Private companies would develop production
Under the proposed model, the United States would acquire ownership stakes in the fields, while private companies would develop production and provide the Venezuelan government with additional oil revenue. The talks could give Washington access to Venezuela’s oil reserves and potentially double U.S. oil reserves.
U.S. Secretary of State Marco Rubio and Venezuela’s interim President Delcy Rodriguez are leading the process. Stephen Miller, the White House deputy chief of staff, is also involved in the talks.
Venezuela’s concerns taken into account
The U.S. administration has sought to emphasize that the possible arrangement would benefit the Venezuelan people. Concerns that Rodriguez could be accused of handing the country’s natural resources over to the United States have also been taken into account during the talks.
It remains unclear when a final agreement will be signed. U.S. Energy Secretary Chris Wright is expected to travel to Venezuela next week to discuss ways for U.S. companies to increase oil production in the country.
Impact of the wars in Iran and Ukraine
The talks over the oil fields are taking place as the wars in Iran and Ukraine contribute to disruptions in global oil supplies and rising prices. The U.S. Strategic Petroleum Reserve has also fallen to its lowest level in 40 years.
Venezuela is described as the country with the world’s largest proven oil reserves. Its oil industry has been affected by years of insufficient investment, mismanagement and declining production.
The Trump administration has made expanding access to Venezuelan oil one of the central elements of its energy and foreign policy approach toward the Western Hemisphere. The administration aims for this policy to secure the Western Hemisphere’s energy future in the long term and ease the price pressures caused by the war in Iran.
The latest talks are part of Washington’s broader efforts to restructure Venezuela’s oil sector. The process began after Nicolas Maduro was captured by the United States in January, after which the U.S. administration supported the interim government led by Rodriguez and sought to play a larger role in Venezuela’s energy sector.
