Date: August 31, 2026
Reporter: Kim White
A major oil agreement between the United States and Venezuela is reshaping the ownership and operation of several Venezuelan oilfields, with some Chinese and Russian companies set to lose access to projects they previously operated, according to U.S. officials.
The agreement, announced by U.S. President Donald Trump as part of a broader effort to rebuild Venezuela's oil industry, gives U.S. interests a significantly larger role in one of the world's largest oil-producing nations. Under the arrangement, North American Blue Energy Partners (NABEP), a U.S. oil company now controlled by Venezuelan businessman Alejandro Betancourt, has been awarded 14 new oilfield contracts by the Venezuelan government, bringing its total number of projects in the country to 17.
Several of the fields covered by the new contracts were previously operated by Chinese state-owned companies or affiliates that have faced U.S. sanctions. Other assets are linked to business interests associated with former Venezuelan President Nicolás Maduro.
The development represents a significant shift in Venezuela's energy sector and could reduce the influence China and Russia have built in the country's oil industry over many years.
Venezuela possesses some of the world's largest proven oil reserves, estimated at roughly 64 billion barrels in the areas covered by the new arrangement. The United States is seeking to direct a greater share of that resource toward American markets while encouraging substantial new investment in Venezuela's badly damaged petroleum infrastructure.
The agreement is part of Trump's broader strategy to transform Venezuela's oil industry and establish stronger U.S. economic influence over the country's energy resources. Washington has argued that increased American involvement could help restore Venezuela's production capacity, attract international investment and create a more stable energy relationship between the two countries.
The changes nevertheless represent a setback for China, which has been one of Venezuela's most important economic partners and the principal destination for much of its crude oil exports in recent years. Chinese companies have invested heavily in Venezuela's petroleum sector and have maintained partnerships with the state-owned oil company PDVSA.
Russia has also maintained a strategic presence in Venezuela's energy industry. Russian companies have operated joint ventures and provided technical and financial support to the Venezuelan oil sector, strengthening Moscow's relationship with Caracas.
The new U.S.-backed arrangement threatens to reduce the role of both countries as Washington seeks to reorganize Venezuela's oil industry around American investment and commercial interests.
NABEP's expanded role is particularly significant. The company, which is now controlled by Betancourt, has received contracts covering oilfields that were previously under the control of companies with Chinese or Russian connections. The shift effectively places assets previously associated with Venezuela's traditional international partners into a new framework with stronger U.S. participation.
The deal also comes after years of declining Venezuelan oil production. Venezuela holds enormous reserves, but decades of underinvestment, mismanagement, sanctions and deterioration of infrastructure have prevented the country from producing anywhere close to the levels reached during earlier periods of its petroleum industry.
The country's production fell dramatically from its historic highs, leaving many oilfields, pipelines, refineries and other facilities in need of extensive investment and repairs.
The United States believes American companies can help reverse that decline by bringing capital, technology and expertise into the industry. Washington has presented the oil agreement as part of a broader effort to rebuild Venezuela's economy while also strengthening political institutions in the country.
U.S. officials have linked the initiative to their support for restoring constitutional order in Venezuela through cooperation with members of the 2015 National Assembly, which Washington regards as Venezuela's last legitimate legislative body.
The agreement could therefore have consequences beyond the oil industry. It represents an effort by Washington to reshape Venezuela's economic and geopolitical relationships at a time when the United States is seeking to reduce the influence of rival powers in the Western Hemisphere.
China is particularly exposed to the changes because it has historically purchased large quantities of Venezuelan crude. In recent years, Chinese buyers accounted for more than half of Venezuela's oil exports, with independent Chinese refineries among the most important customers for Venezuelan crude.
The shift toward the United States could therefore force Chinese refiners that previously relied on discounted Venezuelan crude to search for alternative supplies.
Some Chinese companies have been willing to purchase Venezuelan oil despite U.S. sanctions because the crude was available at significant discounts. If sanctions are eased and Venezuelan oil begins trading more openly at international prices, some of those buyers could lose the economic advantages that previously attracted them to the Venezuelan market.
Russia could also face losses as Venezuela restructures contracts and partnerships established under the previous government.
The new arrangement is not without controversy. Legal experts and energy specialists have questioned the transparency and legal foundation of the agreement, particularly because of the political circumstances surrounding the change in Venezuela's government. They have called for both Washington and Caracas to release more details about the contracts and the precise terms under which foreign companies will operate.
There are also questions about how quickly the agreement can translate into increased oil production. Venezuela's oil infrastructure has suffered years of deterioration, meaning that bringing additional production online could require billions of dollars in investment and take years.
The country's heavy crude presents additional technical challenges because it requires specialized refining capacity. Although the United States has refineries capable of processing Venezuelan heavy crude, transporting and processing the oil at scale will require significant investment and logistical planning.
For the United States, however, the strategic benefits could be substantial. Increased access to Venezuelan crude would provide American refiners with a nearby source of heavy oil while potentially reducing dependence on supplies from more distant or politically complicated producers.
The deal could also strengthen Washington's position in global energy markets at a time when conflicts in other major oil-producing regions are disrupting supplies.
The timing is particularly important because the global oil market is already facing uncertainty caused by the conflict involving the United States, Israel and Iran. Disruptions around the Strait of Hormuz have raised concerns about energy supplies and pushed oil prices higher.
Against that background, the possibility of increasing Venezuelan production could provide the United States with an additional source of crude and potentially help diversify global supplies.
For Venezuela, the agreement offers the prospect of attracting large-scale investment and rebuilding an industry that remains the foundation of the country's economy. The government hopes greater production will increase revenue, create employment and generate funds for rebuilding infrastructure.
However, the restructuring of Venezuela's oil sector could also produce political tensions. Critics may argue that granting major foreign companies control over significant oil assets threatens Venezuelan sovereignty, while supporters are likely to contend that international investment is necessary to revive an industry that has been severely weakened.
The removal or displacement of Chinese and Russian operators adds another layer to the controversy because those countries have long been important political allies of Caracas.
For years, Venezuela used its oil industry to strengthen relationships with Beijing and Moscow while resisting U.S. pressure. The new agreement marks a dramatic reversal of that strategy and places Washington at the centre of Venezuela's future energy development.
The implications could extend throughout Latin America. A stronger U.S. economic presence in Venezuela would give Washington greater influence over one of the hemisphere's most strategically important energy producers and could alter regional relationships with China and Russia.
Whether the agreement succeeds will ultimately depend on how quickly Venezuela can restore production, whether foreign investors are willing to commit the necessary capital and whether the political and legal framework remains stable enough to support long-term projects.
For now, the immediate beneficiaries appear to include U.S.-linked energy interests, while some Chinese and Russian operators face the loss of projects they previously controlled.
The transformation of Venezuela's oil industry is therefore becoming part of a much larger geopolitical realignment. Washington is seeking greater control over energy flows, Beijing risks losing access to a major source of crude, Moscow's economic influence faces pressure and Venezuela is attempting to rebuild an industry that has suffered years of decline.
The U.S.-Venezuela agreement could ultimately become one of the most consequential changes in the global oil market, but its full impact will depend on whether the ambitious plans can overcome Venezuela's infrastructure problems, legal uncertainties and political divisions.
For the moment, the message from Washington is clear: Venezuela's enormous oil reserves are being repositioned toward the United States, and companies from China and Russia that once played major roles in the country's energy sector are increasingly being pushed aside.