US eyes 65-billion-barrel Venezuela reserve

US Vice-President J.D. Vance said Washington is pursuing a deal with Venezuela to create an effective 65-billion-barrel oil reserve, with American companies developing production. The arrangement aims to boost global supply, lower prices, strengthen energy security and generate royalties for US taxpayers

Washington: The United States is seeking to create what Vice-President J.D. Vance described as an effective 65-billion-barrel oil reserve through a new arrangement with Venezuela, with American companies expected to develop production and US taxpayers receiving part of the royalties.

Vance presented the agreement as a way to increase global oil supplies, reduce prices and strengthen energy security at a time when Iranian attacks on commercial shipping have disrupted markets.

---

“We’re using, of course, that successful Venezuela operation and some of the friendships and some of the relationships that have developed in the wake of that operation, to create what is effectively a new 65 billion barrel of oil reserve for the United States of America,” Vance told a White House press briefing. Vance said private American companies would enter Venezuela and generate substantial oil revenue.

“Obviously, that’s going to mean world oil markets get only more supply that will lower costs for Americans,” he said. “That means a lot of revenue is going to go to the people of Venezuela.”

The Vice-President said the agreement had been negotiated by Secretary of State Marco Rubio, Defence Secretary Pete Hegseth and other administration officials. “Thanks to the deal struck by Marco and Pete Hegseth and others in the administration, it actually sets us up to where the American people will directly receive some of the royalties as well,” he said.

Vance described the arrangement as beneficial to Venezuelans, American consumers and US taxpayers. “So it’s good for Venezuelans. It’s good for anybody who’s buying gas, and it’s good for the American taxpayer as well,” he said. “So it’s very much a win-win thing.” The Vice President said the agreement would also provide greater stability to energy markets.

Recent developments had demonstrated the importance of securing dependable supplies of oil, gas, critical minerals and other resources, he said.

Vance contrasted the proposed reserve with the Biden administration’s use of the US Strategic Petroleum Reserve. He accused the previous administration of releasing oil to lower petrol prices before the mid-term elections rather than responding to an international emergency.

“And what that meant is for Americans, our Strategic Petroleum Reserve under the administration got extraordinarily low,” he said. Venezuela possesses some of the world’s largest proven crude oil reserves. However, its production has been constrained by years of underinvestment, deteriorating infrastructure, political instability and US sanctions.