Trump’s Venezuela Deal Leaves $100 Billion Question Unanswered

The United States government is pursuing a 35% passive stake in a private Venezuelan oil venture through the Pentagon's Office of Strategic Capital, potentially securing preferential rights to 20% of production at cost. While reminiscent of Franklin Roosevelt’s 1943 attempt to purchase a stake in Aramco, this deal faces significant hurdles due to Venezuela's history of nationalizing assets and failing to honor contracts with majors like Exxon and Chevron. Guest Ellen Wald notes that the arrangement with interim president Delcy Rodriguez remains politically fragile and may conflict with the Venezuelan constitution. Furthermore, the high cost of extracting Venezuela’s heavy crude and the long lead times required for development mean concrete economic benefits are unlikely in the short term. Consequently, private operators remain hesitant to commit capital without robust political and financial assurances from the U.S. government to mitigate the risk of future seizures.