The Trump administration announced Aug. 28, 2026, that the US and Venezuela had agreed to give the US majority control over development of more than 65 billion bbl of Venezuelan proven oil reserves. The agreement presents an extraordinary opportunity to the US oil industry, but also a great deal of risk, at least some of which should seem familiar. Before private capital follows Washington into Venezuela, the industry needs answers to some fundamental questions about the deal’s legal durability, political risk, commercial structure, and ultimate purpose.

The agreement covers 17 fields and roughly 20% of Venezuela’s proved reserves. Development would be led by Barbados-based North American Blue Energy Partners (NABEP)—controlled by Venezuelan businessman Alejandro Betancourt López—under what the White House described as a 100-year concession.

It’s a huge deal. But its timeline alone stretches credulity. A typical international concession agreement would last for 20-30 years, a term consistent with both in-country media reports and outside analysis. As noted by the Center for Strategic & International Studies, Venezuela’s Organic Hydrocarbon Law, passed in January 2026 after Nicolás Maduro’s ouster, only allows “production participation contracts” to private companies, not concessions of any duration.¹

Venezuela’s constitution also creates questions about the agreement. Article 150 requires National Assembly approval of “public interest” contracts to entities based outside Venezuela while Article 302 reserves the petroleum industry to the State.

Beyond the deal itself

Looking beyond legal and structural technicalities, large questions remain regarding both stable governance in Venezuela and the viability of any agreements struck in its absence. There has been no meaningful progress toward establishing a functional democracy in Venezuela since the US captured Maduro.

Both Acting President (and former VP) Delcy Rodríguez and Betancourt owe much of their political and personal fortunes to Maduro and his predecessor, Hugo Chávez. Rodríguez has done a good job of separating herself from Maduro loyalists. Even so, it would be foolish to believe that they will be allowed to rule indefinitely without some combination of the population, the military, and outside actors attempting to do something about it.

What happens to the deal once Trump’s current term ends is also unknown, particularly given that the current legislature has been in place since January 2025 without passing any substantive oil and gas-related laws.

We’ve already been through the Venezuelan side of this. Twice. In just the last 50 years. The country first nationalized its oil industry in 1976, bringing an end to concessions that US operators had held for 50 or more years. During the 1990s, a combination of mounting debt and limited access to capital prompted a ‘reopening’ of sorts, during which companies were allowed to form joint ventures with Petróleos de Venezuela SA (PDVSA) to operate in the Orinoco Belt.

Even as this was happening, however, in 1992 to be precise, former President (and at the time Lt. Col.) Hugo Chávez led a military coup. It failed. He was imprisoned. And upon his release in 1994 he started leading a populist movement which eventually led to his being elected president in 1998. He gutted the constitution and by 2007 had renationalized the bulk of Venezuela’s oil industry.

And yet, Chevron Corp., Eni SPA, and Continental Resources Inc. have all signed deals to develop Venezuelan crude; Chevron’s to the tune of more than $7 billion.

Time will tell.

Reference

1. Hernández, J.I., “Understanding the Implications of the U.S.-Venezuela Oil Deal,” Center for Strategic & International Studies, Sept. 4, 2026.