US energy secretary in Venezuela to sign Trump's 'biggest' oil deal

U.S. Energy Secretary Chris Wright is set Wednesday to sign a controversial oil deal granting the United States control of about one-fifth of Venezuela's huge reserves.

Wright is in Venezuela to seal the deal with the country's interim president Delcy Rodriguez, who has been under pressure to grant the United States a chunk of her country's oil wealth.

Ahead of the meeting Wright told CNBC that Venezuela's oil production would top 2 million barrels per day by the end of the decade, double the output in January, when U.S. forces toppled former president Nicolas Maduro, putting Rodriguez in charge.

President Donald Trump bills it as the "biggest oil deal in world history."

It would still be far off the 3 million barrels per day Venezuela was producing at the end of the 20th century.

Chevron, meanwhile, announced a separate $7 billion deal with Venezuela to develop two additional oil fields in the country's Orinoco Belt, more than doubling output in five years. Chevron is the leading private oil producer in Venezuela.

CEO Mike Wirth told CNBC the stepped-up investment reflects greater assurances of foreign investment since the ouster of Maduro.

Trump has presided over a steep rise in U.S. fuel costs as a result of his war against Iran, and his Republican Party looks likely to lose at least partial control of Congress in November midterm elections.

Wright told reporters in Caracas that the investments would bring "peace, opportunity and prosperity to the people of Venezuela and to the people of the United States."

But the biggest of the deals -- the agreement giving the United States majority control of 65 billion barrels of Venezuelan oil reserves -- has raised major legal and political questions.

Critics have accused Rodriguez of signing away Venezuela's resource sovereignty and highlighted the role played by a controversial businessman acting as a go-between.

The deal is a major about-turn for the "Chavismo" movement of late socialist firebrand Hugo Chavez, who nationalized Venezuela's oil fields two decades ago before being succeeded by his ally Maduro.

Rodriguez's government, which has been eager to comply with Washington's agenda since Maduro's capture and extradition to the United States, has argued that the deal will help Venezuela unlock its energy potential.

"Who benefits from this oil if it stays underground?" National Assembly chief Jorge Rodriguez, the brother of Delcy Rodriguez, asked.

Trump on Tuesday wrote on social media that the plan is part of "unleashing American Energy Dominance!"

AFP