Venezuela’s Oil Reserves Under US Control

Picture Credit: by Tasnimnews

US President Donald Trump has announced plans for the United States to take control of Venezuela’s vast oil reserves and invite major American energy companies to invest billions of dollars in rebuilding the country’s long-neglected oil industry. Venezuela holds an estimated 303 billion barrels of proven crude reserves, around one-fifth of the global total, making its energy sector central to both its economic recovery and global oil dynamics.

Despite this immense potential, Venezuela’s actual output remains limited. The country currently produces about one million barrels of oil per day, a fraction of the levels seen before years of political upheaval, sanctions, and underinvestment. Aging infrastructure has been a major obstacle, with pipelines and facilities left largely untouched for decades. Restoring production to peak levels would require massive capital, with estimates placing the cost at nearly $60 billion.

A US-led overhaul could eventually transform Venezuela into a significant global supplier, creating opportunities for Western oil firms while potentially helping to stabilize global prices. However, such an outcome would take years to materialize. Even with immediate access and investment, the technical challenges of restoring production capacity are substantial, particularly given the degraded state of the country’s energy infrastructure.

Picture Credit: by Axios

The type of oil Venezuela produces also adds complexity. Its heavy, sour crude requires specialized refining capabilities, but it is well suited to many US refineries that were originally designed to process Venezuelan oil. This could make a revival especially beneficial for the United States, particularly for products like diesel and industrial fuels, which remain in tight supply globally.

For now, oil markets are expected to react cautiously. Oversupply concerns and soft global demand have kept prices relatively contained, and any near-term impact from Venezuela is likely to be modest. Analysts note that expectations may move faster than reality, as rebuilding an oil industry of this scale is a long-term endeavor. While Venezuela’s reserves represent enormous strategic value, their full impact on global energy markets may not be felt for five to ten years.