US energy secretary vows oil output will double on visit to Venezuela

President Trump's controversial Venezuela oil deal is gaining more attention, but there are questions about whether the plan to use the revenues to replenish America's depleted emergency energy reserves makes sense. Trump recently claimed that the company now controlling 17 Venezuelan oil fields gives the United States access to 65 billion barrels of proven oil reserves, double the country's own reserves.

The goal is to fill up the Strategic Petroleum Reserve, which is at its lowest level since 1982. However, the Venezuelan oil that the new partnership produces cannot be stored in the SPR due to the high costs and potential operational difficulties. The heavy oil from Venezuela doesn't directly address the issue of America's dwindling emergency oil reserves.

While Venezuela's production has increased to 1.2 million barrels a day, it's still far from its peak levels and the necessary infrastructure repairs could take years. The deal will take time to implement, and even then, it's unclear if it will lower gas prices before the November midterm elections. Congress would need to approve oil purchases to refill the SPR, and the White House is unsure if they can act unilaterally.

Instead, researchers suggest selling the Venezuelan crude on the open market and using the proceeds to buy light crude to refill the SPR.