Trump Deal To Benefit Both Nations
President Donald Trump’s new oil agreement with Venezuela could have major long-term implications for U.S. energy security, American oil companies and the global battle for influence involving China and Russia, according to a leading energy industry advocate.
Tim Stewart, president of the U.S. Oil & Gas Association, said Monday that the agreement announced by Trump on Friday should be viewed as a long-term economic and energy strategy rather than an immediate answer to high gasoline prices.
“This is going to be good for both countries and both industries,” Stewart said during an appearance on Newsmax’s “American Agenda.”
But motorists hoping the agreement will quickly bring relief at the gas pump should temper their expectations.
Stewart said the agreement will not affect Labor Day gasoline prices. Instead, he believes its real impact could emerge over the next 10 to 15 years.
That could make the Venezuela agreement less about short-term fuel prices and more about America’s future energy supply, economic security and influence in the Western Hemisphere.
What Trump’s Venezuela Oil Deal Could Mean for Gas Prices
Gasoline prices remain one of the most visible economic concerns for American households because higher fuel costs can affect everything from family travel to groceries and transportation expenses.
The Venezuela agreement, however, is unlikely to provide immediate relief.
Developing additional oil production can require years of investment in drilling, pipelines, refineries, transportation systems and other energy infrastructure.
Venezuela has enormous petroleum resources, but political instability, sanctions, aging infrastructure and years of inadequate investment have limited the country’s ability to fully capitalize on its oil wealth.
If American companies eventually help expand Venezuelan production, additional supplies could become one factor influencing global energy markets over the long term.
Oil prices are determined by numerous forces, however, including global supply and demand, OPEC+ production decisions, geopolitical events, refining capacity and economic conditions.
American Oil Companies Could Play a Major Role
Stewart believes U.S. energy companies have an important advantage in Venezuela: experience.
American businesses have been involved in Venezuela’s oil and gas industry for generations and helped develop portions of the country’s petroleum infrastructure.
“We helped them build that industry,” Stewart said.
That history means American companies already possess considerable knowledge of Venezuela’s geology, infrastructure and oil fields.
According to Stewart, U.S. producers know how to operate in the country and understand many of the challenges involved in extracting and transporting Venezuelan crude.
That expertise could become increasingly valuable if Venezuela opens additional opportunities for American investment.
Billions in Energy Investment Could Be at Stake
Restoring Venezuela’s oil industry would potentially require substantial investment.
Oil fields need equipment and maintenance. Pipelines and transportation infrastructure must be reliable. Production facilities require modernization, while companies must also evaluate regulatory, political and financial risks.
If conditions allow major redevelopment, American oil producers, energy service companies, equipment manufacturers and other businesses could potentially compete for work connected to Venezuela’s petroleum industry.
The long-term economic stakes could therefore extend well beyond the companies actually drilling for oil.
Energy development typically involves extensive supply chains covering engineering, construction, transportation, machinery, technology and financial services.
For American businesses, Venezuela could eventually represent both an energy opportunity and a significant investment challenge.
Trump Deal Could Challenge China and Russia
The agreement also carries geopolitical significance.
Stewart said the United States benefits when countries choose to conduct business with American companies rather than becoming more economically dependent on China or Russia.
“I think on the macro, it’s better to have companies and countries doing business with the U.S. than doing business with China and Russia,” he said.
Venezuela’s vast natural resources have made the country strategically important to major global powers.
Greater American participation in Venezuela’s energy industry could potentially give Washington additional economic leverage in the Western Hemisphere while reducing opportunities for Beijing and Moscow to expand their influence.
For the Trump administration, that could make energy policy part of a broader national security strategy.
Could Venezuelans Benefit From More Oil Revenue?
Stewart said another potential benefit involves the Venezuelan people themselves.
Expanded petroleum production could generate additional royalties, tax revenue and economic activity.
He argued that Venezuela would benefit if more of its oil wealth supported its own economy rather than strengthening foreign powers such as China.
Whether ordinary Venezuelans ultimately see those benefits would depend on how oil revenues are collected, distributed and managed.
Nevertheless, increased production and foreign investment could create substantial new economic activity if the country’s energy sector successfully attracts capital.
U.S. Government Involvement Changes the Equation
Another noteworthy part of the arrangement is the involvement of the U.S. government, including a military-related component.
Stewart described that aspect of the agreement as particularly interesting for American companies evaluating whether to invest.
Major oil projects routinely involve significant financial and political risks.
Energy companies must consider government stability, contracts, regulations, security, infrastructure, oil prices and the possibility that political conditions could change before an investment produces a return.
Stewart said the petroleum industry is accustomed to making those calculations.
“This is dealmaking,” he said.
He added that oil companies evaluate risk every day and have operated in environments more difficult than Venezuela.
Why Venezuela’s Oil Reserves Matter to America
Venezuela’s energy resources make the country important to the global petroleum market.
But possessing oil underground and successfully producing it are two very different things.
Turning reserves into reliable production requires enormous amounts of capital, expertise, infrastructure and political stability.
That is where American energy companies could play a critical role.
If investment increases and production eventually rises, Venezuela could become a more significant supplier to the global market.
For the United States, closer energy ties could also provide strategic advantages because Venezuela is geographically much closer to American refineries than many other major petroleum-producing regions.
Energy Security Is Also an Economic Issue
Energy policy affects far more than gasoline stations.
Oil and natural gas prices can influence transportation, manufacturing, agriculture, shipping, airline costs and ultimately the prices consumers pay for everyday products.
For retirees and families living on fixed incomes, energy costs can be especially important because increases in transportation and utility expenses can put additional pressure on household budgets.
That is one reason long-term energy security remains an important economic issue in Washington.
Increasing reliable energy supplies while maintaining strong domestic production could provide the United States with greater flexibility when international disruptions occur.
No Immediate Relief at the Gas Pump
Americans should not mistake the Venezuela agreement for a promise of dramatically cheaper gasoline in the coming weeks.
Stewart specifically emphasized that this is a long-term strategy.
Oil markets are enormous and complicated, and bringing substantial new production online can take years.
The potential payoff, according to Stewart, could become much more significant a decade or more from now.
That makes the agreement fundamentally different from policies intended to influence fuel costs immediately.
Trump’s Long-Term Energy Gamble
The ultimate success of Trump’s Venezuela agreement will depend on several factors, including political stability, investment conditions, production costs and the willingness of American companies to commit significant capital.
There are no guarantees.
But the potential rewards could be considerable.
A successful expansion of Venezuela’s petroleum sector involving American companies could increase energy production, create new business opportunities, generate revenue for Venezuela and strengthen Washington’s position against China and Russia.
For Trump, the agreement represents a broader approach that combines energy policy, economic interests and American geopolitical influence.
For consumers, the most important point may be timing.
This is not primarily a Labor Day gasoline-price story.
It is a story about where America’s energy supply, international partnerships and economic influence could stand 10 or 15 years from now.
And if Stewart’s assessment proves correct, the effects of Trump’s Venezuela oil agreement could be felt long after today’s gasoline prices have been forgotten.
