Trump says US will refill its petroleum reserves using Venezuelan oil

United States President Donald Trump has said on social media that oil from a recently struck deal with Venezuela will be ⁠used to replenish the US Strategic Petroleum Reserve, an oil stockpile that the country keeps for emergencies and that has been drawn down sharply in ⁠recent years to respond to global supply disruptions and high fuel prices.

The US president wrote on Truth Social, the social media platform he owns, that the reserve had been made “virtually” empty, while blaming former US President Joe Biden.

Trump said in the post that the “topping out” process will ‌begin shortly, describing the Venezuelan oil as a “Gift from Venezuela to the People of the United States”.

It is unclear how quickly the Venezuela deal could provide oil for the reserve or deliver ⁠any near-term benefit to ⁠US motorists. The agreement Trump announced on Friday is aimed at reviving Venezuela’s battered oil industry, but it will require significant ⁠investment and infrastructure work before production can rise substantially.

The US reserve ⁠held about 290 million ⁠barrels as of August 21, near a 44-year low, after the US drew down its stockpile under both ‌the Biden and Trump administrations in response to global supply disruptions, including Russia’s invasion of Ukraine ‌and ‌the current US-Israel war on Iran.

The “historic” deal with Washington to hand over 65 billion barrels of Venezuelan oil will last 25 years and allow Venezuela to develop its oil industry while preserving “ownership of and sovereignty” of its resources, Venezuela’s interim President Delcy Rodriguez said in a televised address on Saturday.

The project envisages the development of 17 strategic oilfields with an initial production target of 1.5 million barrels per day, she said.

The broader plan also includes the development of eight greenfield oil blocks as part of a wider expansion of the country’s energy sector.

Under the deal, $19 from every barrel of oil produced and sold to the US will flow to Caracas, an arrangement that could be worth $209bn per year to Venezuela, depending on oil prices, Rodriguez said.

Venezuela will keep ownership of its natural resources “while leveraging capital, technology and operational expertise to support the recovery of a strategic industry that has been severely affected by sanctions”, she said.

Caracas has been under pressure to act in line with Washington’s demands since January, after US special forces abducted then-Venezuelan President Nicolas Maduro and Venezuela’s Supreme Court handed leadership over to his vice president, Rodriguez.