The agreement gives the US a direct financial stake in a private company that will be led by Venezuelan businessman Alejandro, with 100-year rights to the oil fields|Repsol|CC BY-NC-SA 2.0

President Donald Trump’s administration has reached an unusual agreement that would make the US government a direct investor in Venezuela’s oil industry.

Trump posted on Truth Social on Friday that the US had struck a deal with Venezuela for majority control of about one-fifth of the country’s oil reserves, or more than 65 billion barrels.

According to the Wall Street Journal, the brokered agreement allows the US to have a direct financial stake in a private company led by Venezuelan businessman Alejandro, with rights to the oil fields for 100 years.

The company would become the world’s second-largest corporate holder of proven oil reserves, behind Saudi Aramco.

Washington plans to take a 35% passive stake in the company and secure the right to purchase 20% of its production at cost. The Pentagon’s Office of Strategic Capital would hold the investment through penny warrants, limiting the government’s upfront financial commitment.

Why Washington stepped in 
The agreement follows months of negotiations after major US oil companies, including ExxonMobil and ConocoPhillips, showed limited interest in returning to Venezuela. Companies remain concerned about damaged infrastructure, security risks, and uncertain legal protections.

Big promises, major risks
Trump said the arrangement would give US oil supplies a major boost, help refill the Strategic Petroleum Reserve (near its lowest level in decades), and eventually reduce US gasoline prices, but many details remain unclear.

Congress must approve reserve spending.

Meanwhile in Venezuela, Acting President Delcy Rodríguez said the deal will bring tens of billions in investment, create thousands of jobs, and generate $209 billion in tax revenue, while upgrading the country’s oil infrastructure.

However, Venezuela currently produces only about 1.1 million barrels a day. Analysts say restoring its oil industry could take years, making any immediate impact on US fuel prices unlikely.

What about Venezuelans?
The agreement has also triggered fierce criticism in the country. Critics argue that Venezuela’s 1999 constitution prevents the sale of its oil reserves and question whether the current government has the authority to grant such extensive rights.

Opponents also warn that a future Venezuelan government could challenge the arrangement, creating additional risks for investors.