From the moment elite US troops swooped into Nicolás Maduro’s compound in Caracas to forcibly remove him from power in January, President Donald Trump made clear that securing control over Venezuela’s oil resources was a key goal of his administration.
The United States would “run” Venezuela, he said at the time, and manage the sale of Venezuelan oil for the foreseeable future.
The signing of a huge US-Venezuela oil deal in Caracas on Wednesday marked the fruition of that plan. The agreement grants a US-led company 100-year concessions over 17 oilfields in Venezuela, amounting to a staggering 65 billion barrels of crude. That equates to more than a fifth of the country’s proven oil reserves.
Beyond the eye-watering numbers, both sides heralded the deal as good for their respective nations.
President Trump called it “the biggest oil deal in world history”, while the interim Venezuelan President, Delcy Rodríguez, said the agreement was “historic”, and would generate $100bn (£74bn) in investment and more than $200bn in tax revenue.
Others profoundly disagreed.
“This is a terrible deal. [Rodríguez] has given away 20% of the national patrimony for nothing,” said Trump’s former special representative on Venezuela and Iran, Elliott Abrams. “I think she is simply complying with the demands she’s getting from Washington.”
On Tuesday, the White House released a fact sheet which set out some details of the deal’s framework. The US government will work alongside a private business in Venezuela called North American Blue Energy Partners (Nabep), the second largest private oil producer in Venezuela after Chevron.
One extraordinary detail of how the Trump administration will work with Nabep is that the US government will have “veto power over the appointment of any member of the board of directors, and a majority of Nabep’s board of directors must be US citizens”.
With the ongoing US war with Iran increasing prices at the petrol pumps, a boost in oil production outside of the Middle East could affect consumers.
Secretary of the Interior Doug Burgum told Fox Business the pact was “shifting the geopolitical centre of the global energy markets” away from what he called the “choke points in the Middle East” and back to the Western Hemisphere.
There is a logic to the US-Venezuela partnership, Elliott Abrams argued, while Gulf oil supplies are currently so unreliable. But he said the terms are so one-sided they are a “kind of fever dream of what colonialism looks like”.
The White House has spoken of the deal having “re-established the Monroe Doctrine”, an 18th Century principle exerting US power across South America – “purging foreign malign influence from our backyard and ensuring American dominance in our hemisphere is never again questioned”.
Despite the insistence from both governments that the plan will benefit both Venezuelans and Americans, it is not without pitfalls and clear unanswered questions.
The proposed timeframe alone is problematic. Trump has said the agreement will generate profit within two or three years. Energy experts, however, warn the dire state of the Venezuelan oil sector means a decade is more realistic.
Luis Pacheco, of the Baker Institute at Rice University in Houston, told BBC Mundo that Venezuela needs to invest about $100bn over eight years in order to return to its oil production levels of 30 years ago.
“It’s important to know who will manage those resources and for what purpose,” Pacheco said.
“Are they going to put the same people in charge of managing that money who already squandered the biggest oil boom of the century?” he asked, referring to past mismanagement of the country’s oil wealth.
The Venezuelan opposition is concerned the deal deepens President Trump’s relationship with Delcy Rodríguez, whom they accuse of heading the same regime as Maduro.
The Trump administration not only decried Maduro’s government as a corrupt drug cartel, but surrounded Venezuela with the biggest armada of the modern era.
The ease and speed with which Washington has now pivoted to working with Maduro’s former vice-president infuriates the opposition.
The Nobel Peace Prize winner and presidential hopeful, María Corina Machado, may choose not to publicly criticise President Trump, whose support she needs if she hopes to come to power. Others, though, have been more forthcoming.
“You chose to use the power of the United States not to liberate Venezuelans, but to ally yourself with our oppressors,” said Venezuelan economist, Ricardo Hausmann, on social media, directing his comments at the US Secretary of State Marco Rubio.
“You opted to push through an asset seizure, an unconstitutional agreement with an illegitimate and oppressive government, instead of using the leadership of the United States to first restore constitutional order and democracy,” he said.
The lack of an imminent election in Venezuela – or, indeed, any clear plan towards one – strikes many opponents as a betrayal.
There is betrayal felt at the other end of the ideological spectrum, too. Although the governing socialist party, PSUV, has backed Rodríguez over the US deal, many Venezuelan socialists see it as capitulation.
