US President Donald Trump said on Sunday that oil secured under a newly struck deal with Venezuela will be used to refill the Strategic Petroleum Reserve, which has been sharply reduced in recent years amid global supply disruptions and high fuel prices.
“One of the things I am going to do with the Venezuelan oil is fill up the Strategic National Reserves which, because of sleepy [former president] Joe Biden, has been virtually emptied,” Mr Trump wrote in a social media post, adding that the “topping out” process will begin very shortly.
He described the Venezuelan oil as a “gift from Venezuela to the people of the United States".
Stocks of crude oil in the US Strategic Petroleum Reserve fell by about 5.3 million barrels in August to 293.4 million barrels, the lowest level since 1982, according to data from the Energy Department.
The reserve was established in 1975 to ease future supply disruptions after the 1973 oil embargo.
The deal gives a US-backed venture control of 65 billion barrels, but production, transport and years of infrastructure investment must come first, and much of Venezuela's crude is extra-heavy oil that fails the reserve's minimum specifications.
The US has tapped into the stockpile as the war in Iran has disrupted Arabian Gulf oil flows through the Strait of Hormuz, which normally carries about a fifth of the world's petroleum.
Under the agreement announced on Friday, the US gained a stake in Venezuela's oil reserves nine months after the US military captured then-president Nicolas Maduro, who now faces narco-terrorism charges in New York.
Venezuela's interim President Delcy Rodriguez called it a “historic” deal in a televised address on Saturday, saying it would last 25 years while allowing Venezuela to develop its oil industry and retain “ownership of and sovereignty” over its resources.
Ms Rodriguez also said the oil reserves would “cease to be an inert, cold statistic and will instead become concrete solutions".
The project envisions development of 17 strategic oilfields with an initial production target of 1.5 million barrels a day.
