Oil sales from Venezuela will continue indefinitely and U.S. sanctions against Caracas will be reduced, sources close to the White House told CNBC’s Brian Sullivan on Wednesday.
President Donald Trump said Tuesday that Venezuela will turn over 30 million to 50 million barrels of sanctioned oil, which will be sold at market prices.
“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 social media post.
But those 50 million barrels are only the first tranche and sales will continue indefinitely, the sources said. U.S. sanctions will be rolled back as part of the agreement, the sources said. The sanctioned oil would have gone to China but will be re-reouted to the U.S.
Trump said Tuesday that storage ships will transport the oil directly to unloading docks in the U.S.
Venezuela, a founding member of OPEC, has the largest proven crude oil reserves. But it is only producing about 800,000 barrels per day, according to data from energy consulting firm Kpler. The U.S., by contrast, is currently producing about 13.8 million bpd.
A majority of Venezuela’s oil exports are shipped to China.
Trump has made clear that U.S. investment in Venezuela’s oil sector is a central objective of the military action that ousted President Nicolas Maduro. He has called on U.S. oil majors to rebuild the South American nation’s energy infrastructure, though the companies have been largely silent so far.