Analysts say Venezuelan crude is hard to extract and refine, and likely can’t replace oil supplies stuck in the Strait of Hormuz.
(Al Jazeera) – When United States President Donald Trump announced “the biggest oil deal in world history” with Venezuela on August 28, he claimed it would “more than double” US oil reserves and “substantially lower gas prices for all Americans”.
Venezuela is home to the world’s largest proven oil reserves – an estimated 303 billion barrels, or about 17 percent of the global total, according to the US Energy Information Administration. But the country’s oil is heavy, sour crude and extracting and refining it is costly.
While US Gulf Coast refineries are able to process this type of oil from Venezuela, analysts have warned that, in reality, Washington’s deal with Caracas will not lower crude prices in the US in the near term.
What is in the US-Venezuela oil deal, and will it lower fuel prices in the US – or elsewhere?
Here’s what we know:
What’s in the new oil deal between the US and Venezuela?
Last week, the Trump administration announced a deal that would give the US control of more than 65 billion barrels of Venezuela’s proven oil reserves. That is more than one-fifth of all of Venezuela’s known oil.
