US President Donald Trump on Tuesday said the oil deal between the United States and Venezuela will help drive down energy costs around the world, describing it as the “largest oil deal in history” and saying it covers 65 billion barrels of oil.Speaking at the UN General Assembly, Trump said the agreement would benefit both Venezuela and the US, while adding that major global oil companies were entering Venezuela.“The biggest oil companies in the world are going in [to Venezuela], and the numbers are absolutely incredible,” Trump said.
Trump highlights 65 billion barrels of oil
Trump said the US and Venezuela had signed an agreement covering 65 billion barrels of oil, which he said would “benefit both Venezuela and the United States enormously and help drive down the cost of energy all over the world”.He also said the two countries together “have more than 60% of the oil in the world”.The deal centres on Venezuela’s vast oil reserves and efforts to revive its oil industry.Venezuela’s interim President Delcy Rodriguez has said the agreement aims to increase the country’s oil production to 1.5 million barrels per day.The deal covers 17 oil fields with a proven potential of 65 billion barrels, according to Rodriguez’s statement cited in the background copy.It could bring $100 billion in investment into Venezuela’s oil industry and generate more than $209 billion in taxes for Caracas.
Venezuela deal expected to boost oil production
The US government and an unnamed private operator in Venezuela have set up a new company with rights to untapped oil fields for 100 years, according to the background information.The US is expected to receive 55% of the new company’s effective output through an ownership stake and the right to buy oil at cost. A US official said oil bought by the US would go towards its strategic oil reserves and the military.However, Venezuela’s oil infrastructure is in poor condition and would require years and billions of dollars in investment to repair.Trump has said the agreement will help lower gasoline prices in the US. But experts believe Venezuelan oil production was unlikely to increase quickly.Amy Myers Jaffe of New York University said the deal could be helpful in the long run but would not immediately change retail gasoline prices. Kevin Book of ClearView Energy Partners said increasing production would take many years because of the scale of investment required.
Trump links Venezuela policy to wider US interests
Trump also highlighted the US military operation in January to arrest then-President Nicolás Maduro.“Since that day, hundreds of Venezuelan political prisoners have been freed. They’ve let them out of jails, and we’re working closely with the leaders of Venezuela to forge a much better future for the Venezuelan people,” Trump said.“Our actions in Venezuela are proof that the United States will no longer permit threats to America to gain a foothold anywhere in the Western Hemisphere,” he added.The oil agreement has also faced criticism in Venezuela. Harvard University professor and former Venezuelan planning minister Ricardo Hausmann called it a “shameful deal”, while criticising the agreement’s legitimacy.
Trump expects Iran deal after US midterm election
In his UN remarks, Trump also said he believed the US would reach a deal with Iran after the November 3 midterm elections.“I believe we’ll make a deal right after the election because it doesn’t make sense for them not to. They’re waiting to see how I do in the midterm election,” Trump said, according to Reuters.Trump also raised the possibility of either reaching an agreement with Iran or taking military action, saying he had “a big decision to make”.
