US Close to Historic Oil Deal with Venezuela

TL;DR

The US Goes After the World's Largest Reserves

According to sources cited by Investing.com, US authorities are in the process of finalizing a deal that could give the United States long-term, direct access to Venezuelan oil fields. At the heart of the negotiations lies a country sitting on 303 billion barrels of proven reserves — the largest in the world — with 90 billion barrels now said to be on the table in discussions over potential ownership stakes.

Models under consideration reportedly include a lease arrangement of up to 100 years covering multiple fields, which would represent one of the most dramatic shifts in American energy policy in generations.

Background: From Blockade to Opening

Following the arrest of Nicolás Maduro in January 2026, the Trump administration launched a systematic easing of sanctions on Venezuela's oil sector. The US Treasury Department's Office of Foreign Assets Control (OFAC) has, since January 2026, issued a series of general licenses — including GL 46, 47, 48, and 52 — that have progressively opened the door to trade in Venezuelan oil and the export of American equipment and technology to the country's petroleum sector.

General License 52, issued in March 2026, effectively permitted all transactions with the state oil company PDVSA and its subsidiaries, with the exception of entities linked to Russia, China, Iran, North Korea, and Cuba.

Production and Exports Rebounding Rapidly

The results have been swift. Venezuelan oil and condensate production has, according to research data, already reached approximately 1.3 million barrels per day in August 2026, and PDVSA has set a target of 1.4 million barrels by year-end. By comparison, production was sharply curtailed following the US naval blockade in December 2025.

Exports to the US Gulf Coast have at times reached nearly 600,000 barrels per day — a level the country has not seen since 2018. Major international companies including Chevron, BP, Eni, Halliburton, and SLB have resumed cooperation with PDVSA, partly driven by a fiscal reform that reduced the state's share of project revenues from 83 percent to between 20 and 35 percent.

Price Pressure Felt in the Market

Increased Venezuelan supply is contributing to an already well-supplied global market. The US Energy Information Administration (EIA) expects global oil production growth to outpace demand growth through 2027, which will build up inventories and push prices lower. The EIA estimates that Brent crude will average $57.69 per barrel in 2026, falling further to around $53 in 2027.

Some analysts see an even more dramatic scenario: if Venezuela succeeds in restoring production to 2–3 million barrels per day, WTI could fall below $50.

For Norway's continental shelf — and for the energy-heavy composition of the OSEBX — a sustained low-price environment represents a significant headwind, even though Norwegian operators are generally competitive at lower breakeven prices than many of their rivals.

Infrastructure Is the Major Bottleneck

Despite the rapid progress, the picture is far from straightforward. Venezuela's oil infrastructure is severely deteriorated after years of underinvestment and sanctions. Experts estimate that repairing pipelines, ports, storage facilities, and refineries could cost between $60 billion and upward of $100 billion, and will require years of political stability.

As early as August 2026, tankers were reportedly facing waiting times of up to one month at Venezuelan anchorages, as the transfer of crude oil from storage tanks is proceeding too slowly. The country's refining capacity is estimated at only around 500,000 barrels per day — against a nameplate capacity of 1.3 million barrels.

Geopolitical Implications

The potential deal is about more than oil. Washington views it as an instrument for curbing Chinese influence in the region and reshaping global energy flows. Redirecting large volumes of Venezuelan crude to the US could create diplomatic friction with China, which was previously one of the country's most important buyers.

Canadian oil sands producers' primary market — the United States — could also face intensified competition if massive investment flows into Venezuelan capacity. The deal is also positioning itself as a strategic buffer against supply disruptions from other producing regions, including Iran and the Strait of Hormuz.

The sources cited by Investing.com stress that negotiations have not been concluded, and that significant legal and political questions remain to be resolved before any agreement could take effect.