The oil deal as farce Here is a skeptical take on the oil deal. The reporter works for Foreign Policy magazine, a competitor to Foreign Affairs.
--- Trump’s Venezuela Oil Deal Is a Farce (excerpts) Keith Johnson, Foreign Policy, September 1, 2026 The Trump administration has managed, in its proposed oil “accord” with Venezuela, to combine its love for state crony capitalism with a yearning for 19th-century imperialism. It is the capstone of U.S. President Donald Trump’s Weltanshauung. The Trump administration chose as its vehicle for this maneuver the second-largest operator in Venezuela, a Barbados-based company known as North American Blue Energy Partners (NABEP). That company is run by Venezuelan businessman Alejandro Betancourt, a friend of the regimes in both Caracas and Washington who has faced investigations in Venezuela, Spain, and Switzerland on suspicion of corruption and money-laundering offenses. (NABEP’s legal counsel maintains that Betancourt “has never been charged with a crime in any jurisdiction.”) Since about 1976, no agreement with a foreign oil company has lasted a full term of a Venezuelan president, let alone that of the concession—and the dividends it pays, if any, will be exceedingly modest, risky, and costly. A future Venezuelan government could, and probably will, abrogate many of the terms. That is exactly the sort of thing that chills long-term, multibillion-dollar investments. Then there are the technical issues of legality. While the Trump administration says that the deal’s oil concessions are for 100 years, that is an impossibility under Venezuelan law, which limits such concessions to 25 years. Additionally, under Venezuelan law, state companies (meaning, in most cases, PDVSA) must have a controlling stake in any exploration and production projects. There is not a legal avenue for U.S. or other foreign oil-industry investment to bigfoot on production there. Beyond all that, there are the technical and operational challenges. The accord opens up 17 blocks to drilling by private companies in some fashion. The bigger half are in the tar-sands heavy Orinoco fields, and the rest are in the relatively accessible Maracaibo lighter oil fields. Both require lots of money. Some will require starting from scratch (called a “greenfield” project) and some, such as those in Maracaibo (referred to as a “brownfield”), will simply require a good capital injection. Venezuela also likely does not have 65 billion barrels of easily recoverable oil that the United States can stake claim to. That number is predicated on a recovery rate—what you can physically suck out of an oil field—that is wildly optimistic. During the early years of the Venezuelan dictatorship, under Chávez, Venezuela mandated that recovery rates for its oil fields would be 20 percent of everything underground. In reality, those fields have a recovery rate of between 6 percent and 8 percent, so a more realistic reserve estimate is around 20 billion barrels. Either way, getting out what oil there is will require cash. Delcy Rodríguez herself spoke of the need for at least $100 billion in investment, a number that the Trump administration has embraced, simply to get Venezuela’s oil production from 1.1 million barrels a day presently to 1.5 million barrels a day in the future. “How do I see the deal as it is? The 100 years are off the table, owning the reserves are off the table, and this idea of ‘control’ is off the table. This is banana republic stuff,” said Luis Pachecho, a former Venezuelan oil executive who is now at Rice University’s Baker Center. Since the U.S. intervention in January, Trump has tried to coax U.S. oil majors to once again invest big money into Venezuela, a place that tends every few years to expropriate assets, change the rules, or imprison executives. Most companies refused then and continue to refuse now—except for one big one (Chevron) and one small one, which is now getting a boost. “Oil majors decided not to invest in those conditions, and Trump said, ‘Then I will. Or I’ll look for someone to do so who is a friend of ours,’” Pacheco said. -from https://foreignpolicy.com/2026/09/01/trump-venezuela-united-states-oil-deal-gas-prices/ -=-=-=-=-=-=-=-=-=-=-=- Groups.io Links: You receive all messages sent to this group. View/Reply Online (#43257): https://groups.io/g/marxmail/message/43257 Mute This Topic: https://groups.io/mt/120991217/21656 -=-=- POSTING RULES & NOTES #1 YOU MUST clip all extraneous text when replying to a message. #2 This mail-list, like most, is publicly & permanently archived. #3 Subscribe and post under an alias if #2 is a concern. #4 Do not exceed five posts a day. -=-=- Group Owner: [email protected] Unsubscribe: https://groups.io/g/marxmail/leave/13617172/21656/1316126222/xyzzy [[email protected]] -=-=-=-=-=-=-=-=-=-=-=-
