The Trump-Rodriguez oil deal: How Washington is reshaping Venezuela’s energy future | World News
In a historic shift from decades of socialist resource management, Venezuela’s Acting President Delcy Rodríguez signed a law Thursday allowing private companies to take full control of oil operations. This marks the biggest change in the country’s energy policy since the era of Hugo Chavez and signals a rapid move towards Western-style economic systems.
The law comes just weeks after a major change in the country’s leadership when US forces captured Nicolás Maduro in Caracas.
Economic change after Maduro
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The signing of the bill follows the Trump administration’s high-risk military operation that led to Nicolás Maduro’s removal from the capital. After assuming the role of acting President, Rodríguez moved quickly to eliminate the state-owned monopoly previously held by Petróleos de Venezuela SA (PDVSA).
Before signing the decree, Rodriguez reportedly consulted US President Donald Trump and Secretary of State Marco Rubio. They discussed details of Venezuelan oil sales and capital flows, which Rubio described to U.S. Senators as a key part of the administration’s regional plan.
“We are talking about the future,” Rodríguez said at the signing ceremony, which took place just two hours after the National Assembly approved the measure. “We are talking about the country we will give to our children.”
Private companies will manage production and pricing
The new law effectively ends state-led mining. Key points include:
- Operational Control: Private companies will now have full management of oil activities at their own cost and risk.
- Approval Process: Companies must demonstrate technical and financial capability through business plans approved by the Ministry of Petroleum.
- Pricing Power: For the first time in twenty years, private companies will have a say in the pricing of the crude oil they produce.
The law also states that oil and gas reserves will continue to belong to the Venezuelan state, even if private partners carry out the extraction and refining.
New protections for foreign investors
To attract wary international investors, the Rodríguez administration has included important legal and financial protections:
Independent Arbitration: Disputes will no longer be limited to Venezuelan state courts. Companies can now seek resolution through independent international arbitration.
Flexible Taxation: The law limits the maximum royalty fee to 30%. However, the government may lower these rates depending on the project’s financial needs and global competitiveness.
Reversing Chavez’s legacy
This new law eliminates the framework established nearly 20 years ago under Hugo Chavez, which emphasized state control over natural resources. The policy change comes shortly after President Trump stated that Venezuelan oil exports would be monitored by his administration, following earlier suggestions by Rodríguez.
Analysts believe the move is a desperate attempt to revive a failing infrastructure and quickly bring in foreign capital to support a stable but fragile transitional government.
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