Washington (Web Desk/Agencies): The United States (US) and Venezuela have reached an understanding that could see up to $2 billion worth of Venezuelan crude oil shipped to American buyers, according to an announcement by US President Donald Trump on Tuesday.
The deal, which Trump portrayed as a major breakthrough, is expected to redirect oil supplies away from China while easing pressure on Venezuela to further scale back production
The agreement reflects what Washington sees as movement by Caracas in response to Trump’s warning that Venezuela must open its oil sector to US companies or face harsher consequences, including the possibility of military action.
Trump has publicly demanded that interim President Delcy Rodríguez grant the United States and private firms unrestricted entry into the country’s energy industry.
For weeks, Venezuela has been sitting on millions of barrels of crude stored in tanks and aboard ships, unable to export them due to a blockade imposed by the Trump administration in mid-December.
That measure was part of an escalating pressure campaign against President Nicolás Maduro’s government, which reached a climax over the weekend when US forces captured Maduro.
Senior Venezuelan officials have condemned the move as an abduction and accused Washington of attempting to seize control of the nation’s oil riches.
Trump said Venezuela would transfer between 30 million and 50 million barrels of what he described as “sanctioned oil” to the United States.
In a message posted online, he said the crude would be sold at prevailing market rates, with the proceeds overseen by him as president to ensure they are used for the benefit of both countries.
He added that US Energy Secretary Chris Wright would be responsible for carrying out the arrangement and that the oil would be taken from existing vessels and delivered directly to US ports.
Redirecting this trapped crude to the United States would likely require shifting cargoes originally meant for China, which has been Venezuela’s largest oil customer over the past decade, especially since US sanctions were imposed in 2020 on firms involved in Venezuelan oil trade.
An industry source said Trump wants the process to move quickly so he can present the deal as an early political success. Venezuelan authorities and state oil company PDVSA declined to comment.
Oil markets reacted swiftly, with US crude prices sliding more than 1.5% following Trump’s statement, as traders anticipated an increase in Venezuelan supplies heading to the United States.
At present, all Venezuelan oil exports to the US are handled by Chevron, PDVSA’s main joint-venture partner, under a special authorization from Washington.
Chevron has been shipping between 100,000 and 150,000 barrels per day and has been the only firm exporting Venezuelan crude consistently in recent weeks despite the blockade.
It remains uncertain whether Venezuela will be able to access any of the revenue generated from these sales. US sanctions have effectively shut PDVSA out of the global financial system, freezing its bank accounts and preventing transactions in US dollars.
Venezuela has been selling its main crude blend, Merey, at a discount of about $22 per barrel to Brent prices at its ports, putting the total value of the proposed shipments at up to $1.9 billion.
Rodríguez, who took the oath as interim president on Monday, is herself under US sanctions imposed in 2018 over allegations of undermining democratic processes.
Discussions between officials from both countries have also covered potential sales structures, including auction-based systems that would allow US buyers to bid for cargoes, as well as the issuance of US licenses to PDVSA partners that could lead to new supply agreements.
In the past, such licenses have enabled PDVSA’s partners and customers — including Chevron, India’s Reliance, China National Petroleum Corporation, and Europe’s Eni and Repsol — to receive Venezuelan crude for refining or resale. According to sources, some of these companies have already started preparing to take deliveries again.
Officials have also talked about the possibility of using Venezuelan oil to replenish the US Strategic Petroleum Reserve at some point, although Trump did not mention this option publicly.
US Interior Secretary Doug Burgum said on Tuesday that a higher flow of Venezuelan heavy crude to the US Gulf Coast would be positive for employment, fuel prices, and Venezuela’s economic recovery.
Speaking to Fox News, he said the country now has a chance to attract investment and rebuild, adding that cooperation with US companies and technology could help transform its economy.
Refineries along the US Gulf Coast are capable of processing Venezuela’s heavy crude and were importing around 500,000 barrels per day before Washington first imposed energy sanctions.
PDVSA has already been forced to curb output because storage capacity is nearing its limits, and without a swift resumption of exports, further production cuts would be unavoidable, according to one source.
Traders adjusted positions following reports of the talks, with price differentials for several heavy crude grades in the US Gulf falling by roughly 50 cents a barrel on Tuesday as expectations of increased Venezuelan supply weighed on the market.