Venezuela says oil deal with US could put US$19 per barrel into state coffers

Venezuelan President Delcy Rodriguez announced that the oil development agreement with the United States could bring approximately US$209 billion (RM841.7 billion) in state revenue, or around US$19 (RM76.51) per barrel of oil produced and sold. In her televised address, Rodriguez explained that this estimate is based on a price of US$65 (RM261.76) per barrel, which could fluctuate.

The pact includes provisions for royalties and profit taxes to benefit the Venezuelan state. For eight new blocks to be developed in the Orinoco oil belt, the royalty rate will be at least 16%, while the profit tax will be 34%. This 25-year bilateral agreement between Venezuela and the United States aims to develop 17 strategic oil fields, with the goal of boosting production to over 1.5 million barrels per day.

In exchange for capital and technology, Venezuela gains from increased production, job creation, infrastructure investment, significant state revenue, and enhanced national industry production chains. Rodriguez expressed that this agreement is just one of several important deals Venezuela is pursuing to become a major energy producer, gas exporter, and to develop its petrochemical industry while retaining full ownership and sovereignty over its resources.