Trump opens Venezuela's oil tap - and the US may gain control over 65 billion barrels - and on the Premium channel, our research team saw this coming two months in advance...
US President Donald Trump announced that the US reached an agreement with Venezuela which would give it "majority control" over more than 65 billion barrels of crude oil reserves.
Venezuela confirmed the agreement, which, according to published details, includes the development of 17 strategic oil sites, investments of more than $100 billion, and cooperation with private companies.
The numbers here are simply enormous,
Currently, the US holds about 46 billion barrels of proven oil reserves - if the 65 billion barrels over which it is expected to gain control under the agreement are added, this amounts to about 111 billion barrels.
This places the US almost in the same league as the United Arab Emirates, with about 113 billion barrels - and above Kuwait, with about 102 billion.
Out of about 1.57 trillion barrels of proven global oil reserves, this means that the US could control about 7.1% of global reserves.
But here it is important to pause,
65 billion barrels in the ground are not 65 billion barrels that will be produced tomorrow morning.
The agreement, according to reports, grants rights for the development of the sites for up to 100 years, with the US expected to receive 55% of the actual output, alongside an ownership stake and rights to purchase oil at cost price.
If all relevant barrels are produced, 55% of them are equivalent to about 35.8 billion barrels.
At a price of about $83 per barrel, this represents a market value of almost $3 trillion.
And truthfully, when you think about it, this already looks like a strategic deal and not just an oil deal -
Venezuela expects the projects to generate more than $209 billion in tax revenues for the country, while development investments are expected to exceed the $100 billion mark.
And what does this mean for the market?
More potential oil supply, in the long term, is bad news for oil prices if the development rate is significant.
For the US - this is a move that could increase American control over the supply chain and give the US significant geopolitical leverage in the global oil market.
For American energy companies - the story could be even more interesting,
An investment of more than $100 billion in developing 17 sites means pipelines, equipment, drilling, field services, infrastructure, storage, transportation, and refining.
In other words, if the agreement is indeed implemented as reported, it's not just about more oil wells.
This is a change on the chessboard of the global energy market,
And the market?
It still cannot price 65 billion barrels as if they are already flowing through the pipeline - but it is certainly beginning to understand that the game has changed.
In oil, as in poker, the winner is not the one with the most cards - but the one who holds the tap.
And now, for the truly interesting part - we predicted all this development long ago on the Premium channel, and also - we identified several companies that could profit from this enormous change, and no, these are not oil companies...
The companies we identified were selected based on smart money movements behind the scenes - and the leading company is already at an all-time high...