Trump’s ‘biggest oil deal in history’ with Venezuela — How will it impact global markets?

The deal will be carried out through a partnership involving private companies. Trump said the agreement was negotiated with the involvement of Secretary of State Marco Rubio, Defence Secretary Pete Hegseth and Venezuela’s interim President Delcy Rodríguez. This also comes months after a US military operation that resulted in the capture of Venezuela’s former President Nicolás Maduro. Maduro was brought to the United States to face federal charges, including allegations linked to narcoterrorism and drug trafficking.

Trump described the agreement as an unprecedented development for the global oil industry. In a social media post, he wrote, “The United States of America has just entered into an Agreement with the Country of Venezuela on THE BIGGEST OIL DEAL IN WORLD HISTORY!”

According to AP, Some Venezuelan oil would go toward refilling the US Strategic Petroleum Reserve, while some could be used by the US military. The deal would give Washington greater access to Venezuelan crude as global energy markets face geopolitical tensions and shipping disruptions.

Oil prices barely react to Trump’s announcement

Brent and WTI futures fell slightly after the news, according to Investing.com.

Traders are looking at the deal against a much bigger global oil picture. The market is already well supplied, while the Israel-Iran conflict and its impact on the Strait of Hormuz remain a much bigger concern for oil prices.

Crude has been trading around the $80-a-barrel range, according to AAA. The Strait of Hormuz is important because around one-fifth of the world’s petroleum normally passes through the waterway. Any serious disruption there can have a much quicker effect on oil prices than a deal involving Venezuela’s reserves.

Oil market researcher Rory Johnston was also sceptical about Trump’s announcement. He said the 65-billion-barrel figure is a “red herring” because the important details of the deal are still largely unknown. “The 65 billion barrel number is a red herring and will have little relevance to any actual deals—the real relevant details of which are still almost entirely unknown,” Johnston wrote on X.

Johnston said the number is unlikely to have much meaning for actual oil deals and suggested Trump would keep repeating the figure regardless of what the agreement ultimately delivers. “It’s just a classic big number that Trump was sure to jump all over and will repeat ad nauseam going forward.”

China could feel the bigger impact 

The deal could have a much bigger geopolitical effect on China than an immediate impact on global oil prices. China has been Venezuela’s biggest oil customer. Venezuelan crude has formed a meaningful, although relatively small, part of China’s oil imports.

Washington’s plan to push Venezuelan oil through “authorised channels” linked to US interests could threaten that supply.

That could affect Chinese refiners that have depended on cheaper Venezuelan crude. It could also change China’s wider energy ties with Latin America, according to analysis from Columbia University’s Centre on Global Energy Policy.

The development comes as Venezuela is reportedly considering leaving OPEC. If Venezuela leaves, it would become the second OPEC member to exit in 2026. The United Arab Emirates left earlier this year. 

Will gas prices come down?

Probably not in the near future.

Trump has said the Venezuela oil deal could help bring down gas prices for Americans. That is an important goal for the Republican president, especially as the Iran war has slowed the movement of Persian Gulf oil and kept energy prices high, with the November US elections approaching.

But experts say cheaper gas is unlikely to come quickly. One of the biggest reasons traders are not rushing to react is because having oil underground does not mean that oil can immediately be produced and shipped. According to oil analyst Patrick De Haan, the 65 billion barrels mentioned by Trump refer to Venezuela’s estimated reserves, which are not barrels that can simply be pumped and sent to global markets. 

Venezuela’s oil industry has suffered from years of underinvestment and declining infrastructure. To increase production, the country would need to repair and rebuild pipelines, refineries, drilling equipment and other parts of its oil industry.

That would require billions of dollars and years of work, analysts say.

It is also still unclear who will pay for the massive infrastructure work or how much it will cost.

The average US gas price was about $4.08 a gallon on Saturday, according to AAA, compared with $3.20 a gallon at the same time last year.

Trump says US will control majority of Venezuelan oil 

Trump said the agreement gives the US majority control of more than 65 billion barrels of Venezuela’s proven oil reserves. He also said the arrangement would come at no cost to American taxpayers.

The deal is not a direct purchase of Venezuela’s oil reserves. Instead, it will work through a partnership with private businesses.

Reuters reported that Trump has given few details about how the arrangement will work. US officials, however, have described it as a public-private partnership. A US official familiar with the agreement said a new private company would be created with an unnamed private operator in Venezuela. The company would receive long-term rights to develop the oil fields.

How much control will the US actually have? 

The full structure of the agreement has not yet been made public. However, according to NBC’s MS NOW, it would give the United States an effective 55% share of the new company’s output. The stake would come through a mix of direct ownership in the venture’s holding company and the right to buy Venezuelan crude at cost, below market prices.

That would come through a combination of an ownership interest and rights to buy oil at cost. The official also said the new company could become the second-largest corporate holder of proven oil reserves in the world, behind Saudi Aramco. 

Reuters reported that the agreement represents a US effort to gain control over roughly one-fifth of Venezuela’s huge proven oil reserves, while also encouraging American companies to invest in the country’s damaged energy sector. 

Trump wants more oil to help lower US fuel prices 

The announcement comes as Trump faces pressure over high gasoline prices in the United States. It also comes at a difficult time for global energy markets. The war involving the US, Israel and Iran has disrupted energy flows through the Strait of Hormuz. 

The waterway previously carried around one-fifth of the world’s petroleum supplies, making the disruption a major concern for oil markets around the world.  The US has also been using its Strategic Petroleum Reserve to deal with the effects of supply disruptions. 

Trump has argued that greater access to Venezuelan crude could eventually increase oil supplies and help bring down fuel prices for American consumers.

Experts, however, have warned that the deal is unlikely to produce a quick rise in Venezuela’s oil output.

American oil companies could get a bigger role 

The deal could also allow more US oil companies to expand their presence in Venezuela. Chevron is currently the only major American oil company operating in the country, according to ABC News. The company has not commented on Trump’s announcement.

Trump has previously encouraged US energy companies to return to Venezuela and invest in its oil industry. But American companies have remained cautious because of Venezuela’s political uncertainty and the poor condition of its energy infrastructure. 

Secretary of State Marco Rubio also welcomed the agreement. Rubio said the deal could bring nearly $100 billion in private investment, create jobs and help rebuild Venezuela’s economy.

He also argued that higher oil supplies could help bring down gasoline prices in the United States. For Washington, the agreement therefore has two major goals: gaining greater access to Venezuela’s huge oil reserves and supporting the rebuilding of the country’s damaged economy. 

The deal could reshape ties between the US and Venezuela and give American oil companies a bigger role in the country. For Venezuela, the investment could bring much-needed money to repair its damaged oil industry.

It could also help the Venezuelan government raise more revenue. For the US, the deal could provide greater access to Venezuela’s huge oil reserves and improve energy security.

However, the full impact of the agreement is still unclear. Many details have not been made public, and rebuilding Venezuela’s oil sector could take years and billions of dollars. Trump has called it “THE BIGGEST OIL DEAL IN WORLD HISTORY!”

But its success will depend on how quickly it is implemented, how much money is invested and whether Venezuela can raise oil production.

Meanwhile, the United States now has broad, day-to-day control over Venezuela following its military intervention in early 2026, with US Secretary of State Marco Rubio acting as the country’s “de facto viceroy” and closely overseeing the interim government led by Delcy Rodríguez through daily communication with Washington.

The US has a say in major political decisions, public statements and cabinet appointments, while the US Treasury has frozen oil revenues and requires Venezuela to submit a monthly budget before funds can be released.