Trump's Venezuela Oil Plan May Not Bring Fast Gas Price Relief to Americans
President Trump announced the "biggest oil deal in world history," following an agreement involving the Venezuelan government.
President Donald Trump announced a monumental oil deal with Venezuela, aimed at securing access to more than 65 billion barrels of oil. However, energy analyst Patrick De Haan from GasBuddy warned that any potential relief from high gas prices for American drivers is likely a long way off. De Haan stated that Venezuela's vast oil resources would require years of investment and development before additional supply could meaningfully impact fuel prices in the U.S. Global refining constraints could also limit any benefits from increased oil production.
President Trump emphasized the deal's potential to double U.S. oil reserves after then-Venezuelan President Nicolás Maduro was taken into custody earlier this year. The agreement, which would not cost American taxpayers, was expected to bring nearly $100 billion in private investment and support thousands of jobs in Venezuela. However, De Haan cautioned that oil production and gasoline prices do not move in lockstep, and numerous hurdles must be overcome before any meaningful savings at gas stations.
De Haan emphasized that substantial investment is required to expand production, and extracting and transporting the oil would take considerable time. Additionally, global refining capacity would need to increase, as refining capacity is already constrained. Even if the agreement is implemented, questions remain about potential legal and geopolitical obstacles.
Despite the promise of lower gas prices, De Haan argued that the process would likely take billions of dollars in investment and years of development before American consumers could see any significant benefits.
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