Oil facilities, along with an oil spill, are seen in Lake Maracaibo.
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The U.S. attacked Venezuela on January 3, 2026, and captured President Maduro. Venezuela now pumps about 1.2 million barrels per day (bpd) of oil, although the peak in 1997 was 3 million bpd. Hugo Chavez came to power in 1999 and started to nationalize the oil industry. But it collapsed in the period 2017-2020 when Trump Part 1 imposed two separate sanctions on the oil industry. By 2020, oil production was only a bit more than 0.5 million bpd.
Venezuela is number 1 in the world for oil reserves, just over 300 billion barrels of heavy oil. There seemed to be a pattern in Venezuela’s oil history: sanctions by Trump Part 1, then falling oil production, followed by military attack, then a new deal for boosting oil production. Might this suggest a pattern of resource exploitation of another country?
U.S. Wants A Direct Stake In Venezuela’s Oil
President Trump announced a new deal with Venezuela last Friday. Talks about the new deal were held at two levels. At a higher level, advanced talks were between the U.S. government and Delcy Rodriguez, acting president of Venezuela. The central agreement is that the U.S. would become a direct stakeholder of 17 oilfields that contain 90 billion barrels of oil reserves. The U.S. would have a “majority control” over 65 billion barrels.
Secretary of State, Marco Rubio negotiated a partnership between the U.S. and private business in Venezuela. Trump said on Truth Social on Friday that this would double oil reserves in the U.S. The Strategic Petroleum Reserve in the U.S. has reached a 40-year low as a result of the Iran war. The deal is an unorthodox arrangement between two governments and private enterprise, especially given its magnitude.
The U.S. would receive a guaranteed volume of oil that would be exchanged at cost. Private investment by the U.S. in Venezuela would amount to $100 billion, and support thousands of jobs during reconstruction of Venezuela’s economy, which obviously centers on the oil industry. Venezuela would receive an extra $200 billion in tax revenue.
Are U.S. Oil Companies In Or Out?
The deal for Venezuela is to allow U.S. oil and gas companies to come in, to repair or develop the oilfields, and to boost production. Venezuela would receive more oil revenue. It’s been eight months since the U.S captured President Maduro, lots of time for Trump to invite oil companies in to revive the industry in Venezuela. But it hasn’t happened—no new deals, no concessions.
Many of the oilfields that Venezuela is offering for the deal lack infrastructure or electricity, and this could require investments tallying billions of dollars.
There have been headwinds also, from security and legal guarantees for U.S. partners, to a lack of contracting experience by the state oil company PDVSA, to friction between small nimble U.S. operators called wildcatters and slower-moving oil majors, to alleged inertia by the U.S. Energy Department.
Chevron has remained in Venezuela through the turbulent years. It is close to a deal to add two new oilfields to its portfolio, an increase from three ongoing joint ventures with PDVSA. Apparently Halliburton, a large service company may get involved by providing its fracking and other equipment to the heavy oil fields.
However, two of Chevron’s rivals have so far declined to engage in talks. The assets of ExxonMobil and ConocoPhillips were nationalized by President Hugo Chavez in 2007. They are still seeking restitution of billions of dollars.
Trump’s announcement has motivated things, as expected. Energy Secretary Chris Wright is planning a trip very soon to Venezuela to talk about plans to increase oil production. It’s been said that several oil company execs are heading to Caracas to sign production deals.
Application To A Second Petrostate: Iran.
The US attacked Iran on February 28, 2026 less than two months after attacking Venezuela on January 3 and capturing President Maduro.
Both countries are petrostates, whose economy is heavily dependent on the extraction and export of oil or natural gas. Venezuela and Iran are No. 1 and No. 3 in the world for oil reserves. But sanctions and lack of investments by western countries meant decline of oil production after 2010 in both countries. Sanctions by the U.S., then falling oil production, followed by military attacks do suggest a pattern of U.S. commitment to energy security.
The similarities between Venezuela and Iran are clear. Could the Venezuela experiment be applied in Iran to end the war? It may seem like a wild idea, but right now the war has no visible end. Maybe President Trump could seek a deal that allows Iran to sell their oil, but with some U.S. takeaway compensation, after major investment by the U.S. to boost Iran’s oil production. New investments by the whole world would follow, to boost Iran’s economy. It may seem fanciful, but right now the U.S. is stuck in a quagmire, and President Trump believes in transactional approaches if he believes in anything.