Venezuela and the United States have reached a deal to export up to $2 billion worth of Venezuelan crude to U.S. ports, U.S. President Donald Trump announced on Tuesday.

The agreement could redirect oil previously destined for China while helping Venezuela maintain production levels despite sanctions.

President Trump said the deal would see Venezuela turning over 30 to 50 million barrels of sanctioned oil to the U.S., sold at market prices with proceeds controlled by the U.S. government to benefit both nations.

“This oil will be sold at its market price, and that money will be controlled by me, as President of the United States, to ensure it is used to benefit the people of Venezuela and the United States!” Trump wrote on social media.

U.S. Energy Secretary Chris Wright will oversee the execution, ensuring oil is taken from ships and delivered directly to U.S. ports.

Chevron to manage oil flows

Chevron currently controls the flow of Venezuelan oil to the U.S., exporting between 100,000 and 150,000 barrels per day under U.S. authorization. The agreement could expand this volume, initially requiring some cargoes to be diverted from China, Venezuela’s largest buyer over the past decade.

PDVSA and Venezuelan officials have yet to comment on the deal. Sanctions continue to restrict Venezuela’s access to global financial systems, leaving uncertainty over whether Caracas will access proceeds from the sales.

Potential auctions and US licenses

Sources report that Washington and Caracas have discussed possible sales mechanisms, including auctions for U.S. buyers and licenses for PDVSA partners like Chevron, India’s Reliance, China National Petroleum Corporation, and European companies such as Eni and Repsol.

There is also discussion about using Venezuelan oil in the U.S. Strategic Petroleum Reserve, though President Trump has not confirmed this.

Market and industry reactions

U.S. crude prices dropped over 1.5% following the announcement, reflecting expectations of increased Venezuelan supply. Interior Secretary Doug Burgum called the deal “great news” for U.S. refineries, gasoline prices, and job security, adding that it could help Venezuela rebuild its economy with American technology and partnerships.

Before the sanctions, U.S. Gulf Coast refineries processed around 500,000 barrels per day of Venezuelan heavy crude. PDVSA has been forced to reduce production due to storage limitations caused by the export blockade.