Energy Secretary Wright details plans for US control of Venezuelan oil
President Trump has been adamant that the U.S. will take control of Venezuela’s oil. Wednesday morning, Energy Secretary Chris Wright explained how the Trump administration envisions this will actually work, saying the U.S. will control the flow and sale of Venezuela's oil and the revenue that comes from those sales.
“Instead of the oil being blockaded, as it is right now, we're going to let the market, let the oil flow, sell that market to United States refineries and to around the world to bring better oil supplies, but have those sales done by the U.S. government and deposited into accounts controlled by the U.S. government," Wright told an energy industry conference organized by Goldman Sachs in Miami.
"And then from there, those funds can flow back into Venezuela to benefit the Venezuelan people, but we need to have that leverage and that control of those oil sales to drive the changes that simply must happen in Venezuela,” Wright said.
Wright also said that he is in “active dialogue” with the Venezuelans and the oil and gas companies that were there before.
“It is going to require this, this cooperation between and pressure between the United States and Venezuela. If we control the flow of oil, the sales of [that] oil, and the flow of the cash that comes from those sales, we have large leverage, but without large leverage, as we've seen in the last 25 years, you don't get change,” he said.
As for what happens to the revenue from those sales, which Wright said would be "deposited into accounts controlled by the U.S. government," it would then "flow back into Venezuela to benefit the Venezuelan people, but we need to have that leverage,” he said.
Wright did not detail how much of that revenue would ultimately flow back into Venezuela. He did say that several hundred thousand barrels of oil could start to flow from Venezuela in the “short to medium term.”
President Donald Trump announced Tuesday night that Venezuela will turn over 30 to 50 million barrels of sanctioned oil to the U.S. Sources told ABC News that those barrels represent the first tranche to be handed over to U.S. control.
Sources also confirmed to ABC News that some sanctions against Venezuela would be lifted to allow for the transport and sale of the oil on global markets, and that the revenue from those sales would be deposited into accounts controlled by the U.S., as Wright said.
The White House declined to comment but did not dispute the reports.
Wright on Wednesday echoed Trump in saying that some sanctions against Venezuela may be lifted, or at least that the U.S. would enable imports of some crucial equipment.
"And as we make progress with the government, you know, we will enable the importing of parts and equipment and services to kind of prevent the industry from collapsing, stabilize the production, and then as quickly as possible, start to see it growing again," Wright said.
Wright also described the current energy infrastructure in Venezuela as "not good,” saying that it had degraded under "decades of under-investment, decades of corruption."
"It's not, of course, just oil and gas. Think of the electricity grid. That's the backbone of a society," Wright further said, adding that he's been talking to leaders in the oil industry about how to improve the infrastructure.
"We're either going to make that happen, make those changes in Venezuela and the capital will flow, or if we can't successfully make those changes in Venezuela, the capital won't flow," Wright said.
