Inside the U.S. Deal to Get Venezuela’s Oil

The U.S. government is taking a stake in Venezuelan oil through the Pentagon, which is highly unusual and has never really been tried before.

The administration is using the deal as a hedge against the chaos in the Middle East caused by Trump's decision to go to war with Iran. Most of the grand plans for the oil will not happen until way after Trump is out of office.

U.S. oil companies want security guarantees and legal reforms before investing because Venezuela is incredibly unstable and dangerous.

Venezuela is uninvestible in its current state due to the legal and commercial constructs in place.

Over 100 million barrels of oil are already in Houston, refined and paid for the war many times over.

According to reporting, Venezuela is selling oil and the U.S. is controlling the process, but the money has not actually come to the U.S.

The administration used the Office of Strategic Capital, an obscure Pentagon office created in 2022, to treat Venezuelan oil access as a national security matter and take a direct stake.

Betancourt was attractive because he had operations on the ground, relationships in Caracas, and a willingness to move quickly without as much concern for risks.

The U.S. gets a 35% stake in the company, the right to buy 20% of oil production at cost, and substantial control over where the oil goes.

Venezuela's constitution says reserves belong to the state and cannot be transferred to a foreign government or private company, creating a conflict with the deal.

The Rodriguez government is only trying to keep itself in power and will do whatever Trump officials tell them to do. The private company structure was deliberately intended to bind future Venezuelan governments to the agreement and make it difficult to unwind.

Republicans are uncomfortable because the deal entrenches Delcy Rodriguez, and the U.S. now has a financial stake in keeping her in power.

The agreement appears to have positive economic benefits, but it will not work without fair and free elections soon.

U.S. oil companies are unhappy because they could find themselves competing against a company backed by their own government.

American consumers will not see or feel anything from this deal for many years because the oil is still underground and takes a long time to ramp up.

Trump is determined to turn Venezuela into a landmark foreign policy win and will use every tool at his disposal to make it a reality he can sell.

Pressure for political change may build and hamper the Trump administration's efforts because the average person has not seen benefits from Maduro's removal.