Will Trump's Venezuela oil deal ease U.S. gas prices?
Summary
President Donald Trump announced a deal between the U.S. and Venezuela to develop 17 Venezuelan oil fields with large reserves. Experts say it will take many years before this increases U.S. oil supply or lowers gas prices significantly.Key Facts
- The deal involves developing 17 Venezuelan oil fields with 65 billion barrels of proven oil reserves.
- Venezuela has the world’s largest proven oil reserves at over 300 billion barrels; the U.S. has less than 50 billion barrels.
- Venezuela’s oil is heavy crude, which is harder to refine into gasoline than the light crude usually processed in the U.S.
- It may take 5 to 15 years before Venezuelan oil affects U.S. gas prices.
- Venezuela’s oil industry needs over $100 billion in investment to restore full production capacity.
- Venezuela’s oil production recently increased slightly to about 1.1 million barrels per day.
- The U.S. will control 55% of the new joint venture, which has a 100-year operation concession in these oil fields.
- Oil company hesitation remains due to past nationalization of Venezuelan oil assets and legal disputes.
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