US President Donald Trump has said oil from a recently announced deal with Venezuela will be used to replenish the country's depleted Strategic Petroleum Reserve (SPR), calling the move a "gift" to the American people.
Trump said in a post on Truth Social that the process of "topping out" the Strategic Petroleum Reserve would begin shortly. He also blamed former President Joe Biden for leaving the emergency oil stockpile significantly depleted.
The US Strategic Petroleum Reserve, which has a capacity of more than 700 million barrels, currently holds around 289.7 million barrels, or roughly 40 per cent of its capacity. The stockpile is near its lowest level in more than four decades after large withdrawals by both the Biden and Trump administrations during periods of global supply disruptions.
Trump had earlier announced a deal involving US control over 65 billion barrels of Venezuela's proven oil reserves through a partnership with private businesses. US officials said the arrangement is aimed at securing American petroleum supplies for decades, with the US expected to control 55 per cent of the effective output from the joint venture and obtain the oil at cost.
However, questions remain over how quickly Venezuelan crude can be supplied to the US reserve. Venezuela's oil industry faces ageing infrastructure, unreliable electricity supplies and other production challenges that could slow the recovery of output.
Analysts have also pointed to logistical challenges because much of Venezuela's crude is high-sulfur, heavy oil from the Orinoco Belt, while the US reserve stores crude in underground salt caverns. The US Energy Department had previously said it was not considering a proposal involving Venezuelan crude to help refill the reserve.
The US has struggled to rebuild the reserve after major releases in response to energy-market disruptions, including following Russia's invasion of Ukraine and the conflict involving Iran. A plan announced earlier this year also involves the release of 172 million barrels from the reserve in coordination with other countries.
While Trump's announcement signals a major shift in the use of Venezuelan oil for US energy security, the timeline for actual supplies reaching the Strategic Petroleum Reserve remains unclear.
