The US is gobbling up Venezuelan oil, but will it lower fuel prices?

Published On 2 Sep 20262 Sep 2026.

Key points

• On Thursday morning (06: 00 GMT), WTI crude futures had climbed by 61 cents, or 0.7 percent, to $90.83.
• The heaviness of Venezuelan crude would be a bigger difficulty for President Trump's stated aim to refill the US Strategic Petroleum Reserve (SPR) with crude from Venezuela.
• These are projected to include Chevron, Italy's Eni, India's ONGC, Colombia's GeoPark and the US's GE Vernova.
• To do this, a White House fact sheet has made public, the US is creating a private joint venture with North American Blue Energy Partners (NABEP).
• The accord will provide the Pentagon's Office of Strategic Capital a 35 percent stake in NABEP.

When United States President Donald Trump confirmed "the biggest oil deal in world history" with Venezuela on August 28, he maintained it would "more than double" US oil reserves and "substantially lower gas prices for all Americans".

Venezuela is home to the world's largest proven oil reserves – an estimated 303 billion barrels, or regarding 17 percent of the global total, according to the US Energy Information Administration. But the country's oil is heavy, sour crude and extracting and refining it is costly.

While US Gulf Coast refineries are able to process this type of oil from Venezuela, analysts have cautioned that, in reality, Washington's agreement with Caracas will not lower crude rates in the US in the near term.

What is in the US-Venezuela oil accord, and will it lower fuel costs in the US – or elsewhere? Here's what we know. What's in the new oil accord between the US and Venezuela?

Last week, the Trump administration confirmed a agreement that would offer the US control of more than 65 billion barrels of Venezuela's proven oil reserves. That is more than one-fifth of all of Venezuela's known oil.

To do this, a White House fact sheet has made public, the US is creating a private joint venture with North American Blue Energy Partners (NABEP). It is owned by billionaire Venezuelan businessman Alejandro Betancourt, an ex-ally of Hugo Chavez, the former socialist president.

NABEP is already the second-largest operator in Venezuela after US oil giant Chevron. It is additionally anticipated to expand its oil operations in Venezuela.

For context, the accord will provide the Pentagon's Office of Strategic Capital a 35 percent stake in NABEP. It will "have reputable US auditors, lawyers, and advisors", the White House noted.

According to The White House, "millions of barrels of new Venezuelan output will be processed through US refineries and pumped with American rigs and infrastructure, supporting billions in investment in the United States and thousands of jobs here at home". The US will be guaranteed a right to purchase 20 percent of the output at cost.

Meanwhile, the joint venture with NABEP has capacity to produce regarding 200, 000 barrels of crude oil per day, increasing US production as Iran's blockade of the Strait of Hormuz has spiked global oil costs, including in the US.

Venezuela's interim President Delcy Rodriguez welcomed the oil accord. It is additionally projected to add much-needed funds to the state's treasury.

Meanwhile, the creation of the joint venture will create it easier for NABEP to operate from Venezuela. It remains under US sanctions.

In practice, the US has been importing sizeable amounts of Venezuelan oil since President Nicolas Maduro was captured in a US military operation in January this year. While his vice president, Rodriguez, was left as interim leader, maduro was flown to the US to stand trial on guns-and-drugs charges. She has since facilitated US access to Venezuela's oil industry and the US has lifted personal sanctions against her.

In August, US Under Secretary of Energy Kyle Haustveit remarked more than 500, 000 barrels per day (bpd) is now moving from Venezuela to the US – some 40 percent of the country's national output of 1.25 million bpd. Have US crude rates fallen since the agreement was confirmed?

According to analysts, US crude rates have actually risen since Trump unveiled the latest accord.

While Brent crude – the global benchmark for oil rates – was hovering between $85-$88 per barrel, johannes Rauball, a senior crude oil analyst at Kpler, the global trade intelligence agency, observed that before Washington's agreement with Caracas, US West Texas Intermediate (WTI) crude was trading concerning $83-$86 per barrel.

"Since then, prices have moved even higher – with WTI pushing past $90 and Brent topping $95 per barrel – driven up primarily by heightened geopolitical risks and acute Middle East supply disruptions around the Strait of Hormuz, " he informed Al Jazeera.

On Thursday morning (06: 00 GMT), WTI crude futures had climbed by 61 cents, or 0.7 percent, to $90.83. Why aren't US crude or gas rates coming down?

While the US-Venezuela accord may improve supply and, therefore, market sentiment in the longer term, near-term costs are unlikely to be impacted since of the practical difficulties of extracting oil from the ground in Venezuela, according to Rauball.

"It will take years for this deal to result in a meaningful ramp-up in production due to Venezuela's severe physical bottlenecks and ageing infrastructure – most notably degraded pipeline gathering systems, insufficient electrical grid support, and a lack of specialised crude upgraders, " he remarked.

As far as US fuel rates are concerned, he went on, US refiners are already operating at maximum capacity to meet demand both domestically and abroad, leaving little room to scale up further.

"While access to heavier Venezuelan crude supplies offers the specific feedstocks US Gulf Coast refiners require, it will not translate into near-term price relief at the pump given these refining throughput constraints and ongoing operational delays, " he remarked.

Tracy Shuchart, senior economist at futures trading platform NinjaTrader, wrote in a post on X on August 29: Everyone cheering the Venezuela accord thinks a flood of cheap oil is concerning to hit and pull gas rates down. It isn't.

"Venezuela pumps regarding 1.2M bpd right now, up from just under a million. That gain came mostly from Chevron ramping up existing wells after sanctions were lifted, not from new drilling. The straightforward barrels are already back. The reserve number is a stock that will take decades to convert to flow, " she remarked. What does this accord mean for global oil costs?

Iran's closure of the strait, through which more than 20 percent of global oil and natural gas is shipped in peacetime, has upended global energy markets.

Shortly after the strait was closed in early March, the cost of Brent crude oil rose above $100 per barrel. Before the war, it was trading at regarding $66 per barrel. On Thursday, Brent crude rose $1.03, or 1.1 percent, to $95.68 a barrel at 06: 05 GMT.

According to Kpler's Rauball, the immediate impact of the US-Venezuela oil accord on global crude costs remains "neutral" as current markets remain focused on short-term geopolitical supply shortages caused primarily by the closure of the Strait of Hormuz.

"Over the longer term, a successful ramp-up will gradually growth the overall availability of Venezuelan crude in the global market. This continued volume will assist growth crude supply globally over time, ultimately exerting persistent downward pressure on global oil costs further down the line, " he stated.

But there are a number of reasons why an climbed supply of Venezuelan oil ultimately cannot create up for the reduced supply of oil from Gulf producers which employed to be shipped through the Strait of Hormuz.

Frederic Schneider, a nonresident senior fellow at the Middle East Council on Global Affairs, remarked: "The US-Israeli war on Iran took at least 10million barrels a day off the market through Hormuz. Venezuela cannot replace that, additionally partly as it is a different grade, namely, heavy, sour crude which competes with other heavy imports (mostly Canadian and some Mexican) rather than substituting for the lighter Gulf oil."

Hamad Hussain, a climate and commodities economist at the United Kingdom-based firm Capital Economics, additionally informed Al Jazeera that developing oilfields in Venezuela requires significant amounts of investment and time before more crude could be produced and sold to global markets.

"Even in the long term, the potential for political instability and high costs involved could create investors wary of committing to oilfield projects in Venezuela. This could hold back the extent to which oil supply in Venezuela increases and, in turn, limit the downward pressure on crude oil rates over the coming years, " he informed Al Jazeera.

Furthermore, only a few countries have refineries capable of processing the particularly heavy oil which Venezuela produces. These are primarily the US, China and India.

"Refineries in Europe are geared towards refining lighter grades of crude, so there would be little interest in importing oil from Venezuela there, " Hussain remarked.

The heaviness of Venezuelan crude would be a bigger difficulty for President Trump's stated aim to refill the US Strategic Petroleum Reserve (SPR) with crude from Venezuela. This is since storing oil from Venezuela in the SPR could cause damage to the underground caverns.

Global crude rates will, therefore, additionally continue to depend heavily on how the US and Israel's war on Iran. It has paralysed the Strait of Hormuz, plays out. So who will really benefit from this accord?

US oil firms are probable to earn the biggest gains from this accord. After the accord was unveiled late on Friday, shares in Chevron, at present the only sizeable US oil firm active in Venezuela, rose 2.2 percent to $206.20 on the Dow Jones index of publicly listed businesses.

On Tuesday, US Energy Secretary Chris Wright remarked a number of oil firms from the US and other countries are additionally projected to sign oil deals in Caracas this week. It will rise Venezuela's crude oil production. These are projected to include Chevron, Italy's Eni, India's ONGC, Colombia's GeoPark and the US's GE Vernova.

Venezuelan oil production peaked above 3 million bpd in the late 1990s but plummeted after that due to lack of investment, mismanagement and US sanctions. In recent months it has been regarding 1.1 million to 1.2 million bpd, rising slightly since President Nicolas Maduro was abducted by US forces in January.

For now, the US is gobbling up Venezuelan oil, but will it lower fuel remains the part of the story worth watching, and further updates are likely as more details are confirmed.