US Energy Secretary, Chris Wright has said Washington will control the sale of Venezuelan oil “indefinitely,” following President Donald Trump’s announcement that Venezuela’s interim leadership had agreed to US-managed marketing of between 30 and 50 million barrels of crude.
Speaking on Wednesday, January 7 at a Goldman Sachs energy event in Miami, Wright said the United States would oversee the sale of Venezuela’s crude oil, starting with stored supplies and continuing into the future.
“We’re going to market the crude coming out of Venezuela, first this backed-up stored oil, and then indefinitely, going forward, we will sell the production that comes out of Venezuela into the marketplace,” he said.
His comments came days after the US-led removal of Venezuelan leader Nicolas Maduro, which left his deputy and other allies in control of the government. Wright indicated that sanctions on Venezuela’s oil sector could be eased to enable exports.
He added that the United States would supply the diluting agents required to process Venezuela’s extra-heavy crude for shipment. According to him, cooperation with the interim government would also allow the importation of parts, equipment and services needed to prevent a collapse of the oil industry, stabilize production and eventually increase output.
Wright, a former oil and gas executive, said restoring Venezuela’s oil production to historical levels of more than three million barrels per day would require tens of billions of dollars and significant time, but insisted it was achievable.
In the short to medium term, he said production could increase by several hundred thousand barrels per day with relatively modest investment, spare parts and efforts to revive existing facilities.
Venezuela claims to hold roughly a fifth of the world’s oil reserves, though analysts note that any rapid increase in output would be constrained by aging infrastructure, low prices and ongoing political uncertainty.
Trump said on Tuesday that between 30 and 50 million barrels of Venezuelan crude would be shipped to US ports, with the proceeds estimated at more than $2 billion at current prices, placed under his control.
Maduro and his wife were captured in Caracas on Saturday and flown to New York to face drug-related charges.
It remains unclear whether Venezuela’s interim president, Delcy Rodriguez, formally agreed to the arrangement, how the plan would be implemented, or the legal basis for US control of the oil sales.
“Think about where Venezuela was a week ago,” Wright said. “It’s a little different today, but everything else is largely the same. This is going to require cooperation and pressure between the United States and Venezuela.”