The United States needs to control Venezuela's oil sales and revenue indefinitely to drive the changes it wants to see in the country, Energy Secretary Chris Wright said on Wednesday.
The comments reflect the importance of the South American country's crude oil reserves to President Donald Trump's strategy since US forces ousted Venezuelan leader Nicolas Maduro in a raid on the capital Caracas on Saturday.
"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 at the Goldman Sachs Energy, CleanTech & Utilities Conference in Miami.
STORED OIL MOVING TO MARKET FIRST
He said the US would market stored Venezuelan oil first, then sell ongoing future production, including to US refineries specially equipped to process it, with revenues deposited into accounts controlled by the US government.
Wright added he was speaking to US oil companies to learn what conditions would enable them to enter Venezuela to help boost production there.
"The resources are immense. This should be a wealthy, prosperous, peaceful energy powerhouse," he said.
"That's the plan." On Tuesday, Caracas and Washington reached a deal to export up to $2 billion worth of Venezuelan crude to the United States, an accord that would divert supplies from China while helping Venezuela avoid deeper oil production cuts.
The agreement is a sign Venezuelan government officials are responding to Trump's demand that they open up to US oil companies or risk more military intervention.
Trump has said he wants interim President Delcy Rodriguez to give the US and private companies "total access" to Venezuela's oil industry.
"Instead of the oil being blockaded as it is right now, we're going to let the oil flow," Wright said at the conference.
Selling Venezuelan oil "will benefit the American people, the American economy and global energy markets, but of course, it will also massively benefit the people of Venezuela," he said.
Shares of US refiners Marathon Petroleum, Phillips 66 and Valero Energy were up between 2.5% and 5%.
WHITE HOUSE MEETINGS
Raising crude output from Venezuela is a top objective for Trump, who is scheduled to meet with the heads of major oil companies at the White House on Friday, according to sources.
Representatives from Exxon Mobil, ConocoPhillips, and Chevron - the top three US companies, all of which have experience in Venezuela - would be present, according to a source familiar with the planning.
The companies have declined to comment.
Venezuela was producing as much as 3.5 million barrels per day in the 1970s. But mismanagement and limited foreign investment led to a huge drop in annual production, which averaged about 1.1 million bpd last year.
Wright said he believed short-term production increases in Venezuela are possible, but that a bigger recovery to past production levels would take years.
"We could get several hundred thousand barrels a day of additional production in the short to medium term if the conditions are there for just small capital deployments," Wright said. "To get back to the historical production numbers, you know that takes tens of billions of dollars and significant time," he said.
The South American country sits atop the world's largest oil reserves but accounts for only about 1% of global supply.
