Trump’s Trillion-Dollar Oil Play: A Trap For Big Oil?
U.S. President Donald Trump’s core vision of the future of global oil and gas is to have as much of that supply as possible coming from his self-proclaimed ‘Americas’ region, which is directly in the U.S.’s sphere of influence. Venezuela is one of the key countries from which this increased production is designated to flow, which is why Washington is focusing so much of its efforts on encouraging…
President Donald Trump's vision for global oil and gas production involves a significant portion coming from the Americas region, with Venezuela being a key country. The U.S. is encouraging heavy investment from American oil and gas companies into Venezuela through changes to the country's Organic Hydrocarbons Law. Recently, these changes were detailed during the Venezuela Global Investment Forum 2026, aimed at attracting international capital.
The new law creates various investment options for foreign firms, including hydrocarbon productive participation contracts, joint ventures with state-owned PDVSA, and direct contracts for infrastructure and oilfield services. The most direct investment route is through CPPHs, allowing a Venezuelan-incorporated company to operate a designated area at its own cost and risk for 25 years, with the ability to sell its share of produced oil and gas directly to international buyers.
The new framework offers different combined royalty and tax rates, ranging from 20 percent for greenfield projects to 35 percent for existing operational assets. While the revised hydrocarbons framework is seen as Venezuela's most aggressive attempt to attract foreign investment in decades, there are still structural hurdles, such as the need to comply with U.S. Treasury OFAC general licenses and the potential risk of domestic corruption in key projects.
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