Venezuela ‘turning over’ $2bn in oil to US, Trump says, in move that could cut supply to China

Donald Trump has said Venezuela will be “turning over” $2bn worth of Venezuelan crude to the United States, a flagship negotiation that would divert supplies from China while helping Venezuela avoid deeper oil production cuts.“This Oil will be sold at its Market Price, and that money will be controlled by me, as President of the United States of America, to ensure it is used to benefit the people of Venezuela and the United States!” Trump said in a post online.Venezuelan government officials and state company PDVSA did not provide comment.Venezuela has millions of barrels of oil loaded on tankers and in storage tanks that it has been unable to ship due to the blockade imposed by Trump, as part of the pressure campaign that culminated in the toppling of Nicolás Maduro who was seized from his country by US forces over the weekend.Top Venezuelan officials have called Maduro’s capture a kidnapping and accused the US of trying to steal the country’s vast oil reserver, however Tuesday’s agreement is a strong sign that the government is responding to Trump’s demand that they open up to US oil companies or risk more military intervention.Trump has said he wants interim president Delcy Rodríguez to give the US and private companies “total access” to Venezuela’s oil industry.US energy secretary Chris Wright is in charge of executing the deal, Trump said, adding that the oil will be taken from ships and sent directly to US ports. Supplying the trapped crude to the US could initially require reallocating cargoes originally bound for China, two sources had told Reuters earlier on Tuesday.China has been Venezuela’s top buyer in the last decade and especially since the United States imposed sanctions on companies involved in oil trade with Venezuela in 2020.US crude prices fell more than 1.5% after Trump’s announcement, with the agreement expected to increase the volume of Venezuelan oil exported to the US. That flow of oil is currently controlled entirely by Chevron, PDVSA’s main joint venture partner, under a US authorisation.Chevron, which has been exporting between 100,000 and 150,000 barrels per day of Venezuelan oil to the US, is the only company that has been loading and shipping crude without interruption from the South American country in recent weeks under the blockade.It was not immediately clear if Venezuela would have any access to proceeds from the supply. Sanctions mean PDVSA is excluded from the global financial system, its bank accounts are frozen and it is blocked from executing transactions in US dollarsHours before Trump’s announcement on Tuesday, Rodríguez hardened her tone against the US, saying in a televised address that “no external agent governs Venezuela” – a clear rebuttal to the US president’s claim that, after the capture of Maduro, the US would now run the South American country.It marked another shift in tone from Maduro’s former vice-president. After being sworn in as president by Venezuela’s supreme court on Saturday, Rodríguez released a conciliatory statement late on Sunday in which she “invited the US government to work together on an agenda of cooperation”.In Tuesday’s address, however, Rodríguez reverted to harsher language, describing Saturday’s strike – the first large-scale US military operation on South American soil – as a “terrible military aggression” and a “criminal attack” whose “absolutely illegal outcome, in violation of international law”, was the “kidnapping” of Maduro and his wife, Cilia Flores.“We are a people who do not surrender, who do not give up, and we are here, governing together with the people. The government of Venezuela rules in our country – no one else. There is no external agent governing Venezuela. It is Venezuela, its constitutional government, and the consolidated power of the people,” said Rodríguez, who had served as Maduro’s vice-president since 2018.With Reuters