Venezuelan oil workers. Photo: Ernesto Vargas/AP Photo.
Washington could gain access to 90 billion barrels of oil reserves, while Caracas is weighing an OPEC exit
The US is moving to lock in long-term access to the world’s largest proven crude oil reserves by discussing a 100-year deal with Venezuela, as Caracas plans to leave the Organization of Petroleum Exporting Countries (OPEC), several outlets have reported.
The idea of quitting OPEC has been discussed during talks with US officials, according to Bloomberg’s sources, although no final decision has been made.
Venezuela was one of five countries that founded OPEC in 1960, alongside Iraq, Iran, Saudi Arabia, and Kuwait. It has effectively operated outside the group’s production quota system for years, while decades of US sanctions and domestic economic turmoil have battered its oil industry and diminished its influence within the organization.
A withdrawal from OPEC would mark a major realignment in Caracas following the January 3 US operation that kidnapped Venezuelan President Nicolas Maduro. Washington has since taken control of Venezuelan oil sales and revenues, with proceeds deposited into US-controlled accounts and Caracas’ access to the funds subject to decisions in Washington.
The US is also seeking a steady flow of Venezuelan crude to its refineries while encouraging American companies to expand their presence in the country’s energy industry. Venezuela currently produces around 1.25 million barrels of crude per day, well below its historic output.
Us pushing for ‘massive’ century-long oil lease
Talk of a potential OPEC exit comes as Washington pushes for a major stake in Venezuela’s oil fields. A deal under discussion could lock in several fields for American companies under a 100-year lease and guarantee the resulting crude supplies to the US.
“This is real and being discussed at the highest levels of the US and Venezuelan governments,” one source told Reuters. A lease is among the legal models under consideration, with individual fields potentially allocated to US producers through auctions or tenders.
A list involved in the negotiations includes 17 fields, spanning undeveloped sites in the vast Orinoco Belt and mature fields around Lake Maracaibo containing roughly 90 billion barrels of proven reserves. Some are currently operated by a small Chinese company under a contract signed during Maduro’s presidency.
The historic deal could essentially more than double US oil reserves by tapping Venezuela, which holds the world’s largest proven crude reserves. “Calling this deal huge would be an understatement,” one US official told Axios. “It is massive.”
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‘Donroe doctrine’
Taking a stake in Venezuela’s reserves would amount to an almost unprecedented US intervention in another country’s economy, Bloomberg noted, while fitting Donald Trump’s so-called “Donroe Doctrine” of expanding American influence across the Western Hemisphere.
Trump has repeatedly asserted US control over Venezuela’s oil since Maduro’s capture in January. Speaking to oil executives that month, he said Washington would decide which companies would rebuild the sector: “You’re dealing with us directly. You’re not dealing with Venezuela at all.” He went further in the spring, publicly floating the idea of turning Venezuela into the “51st state.”
The proposed arrangement could, however, run into legal hurdles. Venezuelan law does not currently provide for leasing oil acreage, while the constitution reserves core industry activities for the state. Recent reforms allow foreign participation through joint ventures and production-sharing contracts, but Caracas has for decades prevented foreign producers from booking Venezuelan reserves as their own.
With details still being negotiated, legal experts say the proposed deal could face constitutional challenges. US Energy Secretary Chris Wright is reportedly expected to travel to Caracas as soon as next week as talks continue.
Another blow to OPEC
Venezuela’s departure would also hand Trump a small victory in his long-running confrontation with OPEC. The US president has repeatedly criticized the group for wielding too much influence over global oil prices and driving up fuel costs for American consumers.
The push comes as the Trump administration faces pressure over high gasoline prices ahead of this year’s midterm elections. Cheaper Venezuelan crude could help ease fuel costs and replenish the US Strategic Petroleum Reserve, which currently holds around 290 million barrels – about 41% of its capacity.
A Venezuelan departure would come just months after the United Arab Emirates quit OPEC on May 1, seeking greater freedom over its oil production. The move left the organization with 12 members, while UAE state oil company ADNOC subsequently moved to boost crude sales.
Other producers have also pushed back against OPEC restrictions. Iraq reportedly threatened to leave in June unless it was allowed to increase output, although Baghdad later said it had no plans to withdraw. Venezuela and Iran remain exempt from OPEC+ production quotas because sanctions have constrained their output.
