Diesel is at a record and gasoline is close to one, and Liam Denning said the United States could go into the midterm elections with gasoline averaging more than $4 a gallon for the first time.
Trump has called the arrangement he announced late last month the biggest oil deal in world history. Denning and Patricia Laya spent the episode listing what is missing from it: a published balance sheet for the Venezuelan company at the center of it, a clear legal basis for the Pentagon's stake in that company, and an answer to whether an interim president has the authority to sign away oil rights for decades.
"And that's why I feel like the holes and the contradictions in this deal to me speak to the need to send a signal and worry about the execution later."
Denning writes about energy for Bloomberg Opinion. Laya is Bloomberg's Andes bureau chief, and it is her reporting on the businessman who now controls the company Washington has taken a stake in that supplies the second half of this conversation.
I listened to the full episode so you can skip it. 18 minutes of audio, 14 minutes of reading.
Here are the 10 insights that matter.
👤 Guests: Liam Denning, who writes about energy for Bloomberg Opinion, and Patricia Laya, Bloomberg's Andes Bureau Chief, who covers Venezuela from the region
🎙️ Host: David Gura, who presents Bloomberg News' Big Take podcast
📰 Published: 9 September 2026 on the Big Take podcast feed
🔴 YouTube | 🟣 Apple Podcasts | 🔗 Episode page | ⏱️ 18 min
Key Takeaways
Trump needs a fuel-price win before the midterms, and Denning reads the deal as the signal
Diesel is at a record, and gasoline could average above $4 a gallon into the vote for the first time
The US pays nothing upfront, takes 20% of production at cost, and gets first refusal on the rest
The venture covers 17 fields holding a claimed 65 billion barrels, about a fifth of Venezuela's stated reserves
A federal stake in an oil producer is close to a US national oil company, which is the part that surprised Denning
The White House calls large-scale oil investment a precondition for a democratic transition, and Denning says that is backwards
Venezuela's first oil boom ran from the 1920s through the 1960s, much of it without democratically elected governments; what deters companies now is the size and length of the spending
No balance sheet has surfaced for the company meant to lead $100B of investment
The Pentagon's stake runs through a loan office set up mainly for critical minerals
Denning said it is far from clear the arrangement would survive a court challenge
Whether an interim president can sign away decades of oil rights is unresolved
The United States called the 2024 election fraudulent, and Delcy Rodríguez was declared vice president under it
The opposition leader questioned the terms but would not call for the deal to be scrapped
The major oil companies like the policy and are keeping their distance from the venture
A successful first year adds 100K–200K barrels of production and does nothing to US pump prices
1. The Eight-Week Bet
Gura opened the show, on a day when oil "has once again topped $100 a barrel," by asking Denning whether the deal is a bet on the next hundred years or on something happening in the eight weeks before the US midterm elections. Denning's first response was "Next hundred hours?"
He then gave two answers, and only one of them is about oil. The long-term case is territorial: "So there is the kind of grand strategy, long-term strategy, answer, which is that the U.S. can somehow fashion some kind of Western Hemisphere-like oil fortress, and Venezuela will be very much a part of that"
The near-term case is the price of fuel, and Denning said the administration is clearly feeling it. "He badly needs to signal that he's noticing people's unease about fuel prices, which are diesel's at a record, gasoline is close to a record"
The number that frames the vote: "It's very possible that we may enter the midterms with gasoline above $4 a gallon on average for the very first time"
Denning treats the gaps in the announcement as evidence of the timetable rather than as sloppiness. "And that's why I feel like the holes and the contradictions in this deal to me speak to the need to send a signal and worry about the execution later"
2. The Deal in Broad Strokes
Trump announced the agreement late last month, calling it the biggest oil deal ever in world history. Asked to describe it, Denning began: "Broad strokes is all we've got."
The structure, in his account: "Essentially, what the president was announcing was that the US government would be essentially going into some kind of joint venture or taking a stake in North American Blue Energy Partners, a local Venezuelan operator, taking a 35% stake, apparently, and that venture would develop 17 oil fields in Venezuela, which apparently sit upon 65 billion barrels of reserves, roughly a fifth of the country's touted oil reserves."
The payment terms run one way. "And in return, the US seemingly would pay no money for this upfront and would get 20% of any production at cost and then a right of first refusal on the other 80%, which I assume would be, in the event of some kind of major global disruption, the US would be able to claim that oil"
What surprised him was the structure, not the announcement. "I think what has surprised me was the nature of it, the idea that the U.S. is effectively going to form some kind of quasi-national oil company with the federal government taking a direct stake"
That an oil deal was coming has been obvious since the winter: "It's been clear since Trump authorized a military operation that removed Nicolás Maduro in January, that he sees this as very much facilitating some kind of oil deal"
3. How Rodriguez Got the Pen
Gura asked Laya to retrace how Delcy Rodríguez ended up in a position to announce the deal, calling it a chaotic year in Venezuela. Her account starts with the capture.
Maduro "was captured by U.S. forces in the early hours of January 3rd," and Rodríguez was his vice president at the time
She held several of the jobs that matter for an oil agreement at once. Laya listed vice president, finance minister and president of PDVSA, the state oil company: "She had all sorts of roles, very important, influential roles within the Maduro government"
The succession itself was constitutional: "And constitutionally, once the president is gone, of course, she as vice president would take that role"
Laya said Washington also had a reason to prefer her. "But also, I think the U.S. saw in Delcy Rodríguez a more pragmatic Chavista official through which they could heavily influence policy, right, over Venezuela"
4. Attacked From Both Sides
Asked how the announcement played inside Venezuela, Laya said it landed badly across the political spectrum, and that the two camps object to opposite things.
The government's own hardliners read it as a giveaway. "On the one end, hardline Chavista supporters see it as her gifting Venezuela's oil or sort of surrendering Venezuela's sovereignty over its oil reserves"
The opposition's worry is the relationship rather than the barrels — that a closer tie between Washington and the interim government entrenches Rodríguez in power and lends her the legitimacy to sign a long-term agreement over the country's oil
The two governments describe the same document differently. "But Venezuela has really stressed that it would remain or retain sovereignty over these resources underground, while the U.S. has framed it differently"
The authority question has no settled answer. "That is a huge question that everybody's asking because Maduro was called illegitimate by the U.S. before he was captured, right?" Laya said the United States also called the 2024 election he claimed to have won "completely fraudulent" — and Rodríguez was declared his vice president under that same election
The result is a legal hole under a decades-long commitment: "So there are a lot of questions about whether she can sign this kind of agreement under an interim government"
5. Machado's Careful Line
Laya turned to what the deal has done to Venezuelan politics, with a second round of talks between the Chavistas and the opposition due to start this month. The White House, she noted, was careful to say in its fact sheet that it still supports those negotiations toward a democratic transition.
The deal has unsettled the opposition, and particularly the party of Maria Corina Machado, who has neither endorsed it nor called for it to be scrapped
Machado criticized the terms without asking for the deal to be canceled. "She has questioned the terms and Rodriguez's authority, but really stopped short of demanding the deal to be totally scrapped and said the U.S. should be Venezuela's natural energy partner"
Laya's read of the caution is that Machado fears the Trump–Rodríguez relationship entrenches the interim government and reduces the US incentive to press for quick elections
The counter-offer is to present the opposition as the more durable partner. Machado has published her own proposals for an energy partnership, contrasting the durability of investments made under a legitimately elected government with what is on offer now, aimed at Washington and at international investors
She intends to run for election and will need US backing to do it: "So she's walking a very careful and delicate line at the moment"
6. Will It Survive 2029?
Gura put it to Denning that past Venezuelan governments have famously nullified international oil deals, and asked whether anything in this one would stop a future government doing the same. "So this is the key question, right? The durability of any agreement," Denning said.
He pointed to a line in the White House's own fact sheet that he said got lost, in which large-scale investment in Venezuela's oil industry was called a "key precondition to any kind of democratic transition." That tells you which of the two the administration puts first — "But the second is, I think they've got it backwards"
The history does not support the precondition. "Oil companies are no strangers to dealing with unsavory or unstable high risk regimes," Denning said, noting that Venezuela's first oil boom ran from the 1920s through the 1960s, much of it without democratically elected governments
What deters investment now is the bill and the timescale, not the politics. Rebuilding the industry means processing extra heavy crude and rebuilding the power grid, which takes decades of committed spending: "I mean, the government itself has talked about $100 billion to raise production by 1.5 million barrels a day, which, you do that math, that's a pretty capital-intensive proposition right there"
The oil companies have already turned him down once. "And I think if you go back to when Maduro was first deposed, remember, Trump was pretty offended by the fact that Exxon said this country is basically uninvestable" — the companies did not rush back in, and Denning said the president now appears to think this structure will force their hand
Denning placed the deal against high energy prices amid the war in Iran, and said the president is looking for a win
His reading of the political logic runs through the White House ballroom. If the federal government advances money and is on the hook, Trump's reasoning may be that a Democratic administration arriving in 2029, or a future Congress, will not unwind it: "Just as if you knock down a ballroom and rebuild it, will someone else come and really tear it down later? Maybe not"
Denning's own view is that the structure adds risk rather than removing it. "But in fact, I think they've actually amplified the risk because you're dealing with an unelected, unpopular regime in Venezuela." The administration faces possible midterm setbacks, and Trump's term expires in just over two years
The conclusion he drew for a company weighing a 30-year commitment: "Which oil company, which Western oil company is really going to think, well, if we go in now, sure, we're there for 30 years. Everything's hunky-dory. No, probably not"
7. No Balance Sheet Anywhere
Gura asked what North American Blue Energy Partners actually is. "You tell me," Denning said.
It is a local operator run by Alejandro Betancourt, whom Denning called "himself a controversial figure"
The company now sits at the center of two national interests and is almost unknown. It is critical to Venezuela's future and, in the administration's telling, to US energy security — "And we know barely anything about it"
The specific gap Denning named is the most basic document there is. "I haven't even seen a balance sheet for this company that is supposedly going to lead a hundred billion dollars of investment in one of the most challenging oil development environments on earth"
The legal basis is unclear too. "We're not even sure exactly how legal the purported investment by the Pentagon is. It seems like the administration is really stretching"
Gura stopped the conversation to underline it: "I'm going to pause there just to say that's a wild thing. You have the Defense Department holding a stake in this company"
The vehicle is a Defense Department loan office built for something else. Denning said his reading of the Office of Strategic Capital is that it exists to advance loans, mainly for critical minerals: "I guess if you squint hard enough, crude oil fits that description. But it's far from clear if any of this stuff would hold up if it were challenged in court"
8. A Partner Under Scrutiny
Laya supplied the background on Betancourt, who she said is a well-known name in Venezuela.
He belongs to a group of businessmen who got rich under the previous government. "Alejandro Betancourt is a well-known name to Venezuelans because he's part of a clan known as Bolichicos, which is a class of Venezuelan entrepreneurs who amassed huge fortunes under President Hugo Chavez's government"
The money came from emergency power contracts during the blackouts. "And in his case, he won billions of dollars in emergency power equipment contracts beginning around 2009, during years in which Venezuela was plagued by chronic blackouts"
He did that through a company called Derwick, which Laya said came under scrutiny in Venezuela, the United States, Spain and other countries over suspected money laundering ties involving PDVSA, the state oil company. "Of course, Derwick and Betancourt have denied allegations"
He has since become an oil producer at real scale. Laya said Betancourt now controls Venezuela's leading independent oil producer, which pumps about 200,000 barrels of crude a day — not a small amount for an independent producer in Latin America
That combination is what makes him useful to Washington. "So he, I think, to the Trump administration represents someone who has deep ties across both of Venezuela's political factions and also has sort of a proven track record of producing oil at a large scale in a very complicated country and also during a period of sanctions"
9. The Majors Keep Distance
Asked how the large international oil companies see the deal, Denning drew a line between the policy and the vehicle.
They were not part of it. "My understanding is that they were not involved in this deal per se"
They welcome the direction of US policy. "They like the fact that there is this administration in Washington that is determined to reopen Venezuelan oil production"
The opportunity is real because of how far the industry fell: under the Chavista government, Denning said, the national oil company was gutted of expertise, the physical infrastructure rotted away and production collapsed
The distinction Denning drew is between the country and the venture. "I think for the oil companies, it's good to have Washington focused on reopening Venezuela, but I think they probably want to keep a fairly healthy distance from this other venture that's being talked about"
10. Success Is 100K Barrels
Gura's last question was what would have to happen for the deal to work. Laya's answer set a bar far below the announcement.
"I think it will be quite challenging for this deal to be a success"
Most of the acreage is nowhere near working infrastructure. "I think many of these 17 fields are very far from the infrastructure that regularly operates at some level in Venezuela's oil production," and many will likely not start production next year or in the coming years
Her definition of a good outcome is a rounding error in the oil market. "If anything, it could be deemed a success if it increases production maybe by 100,000 to 200,000 barrels by next year"
That would not reach the voters the deal is aimed at. "But of course, that will not have an impact on U.S. fuel prices," and no important effect on world oil production either — so no meaningful impact for a US voter expecting consequences from what Trump called one of the biggest energy deals signed in recent time
Bonus Insights
Gura's framing question — a bet on the next hundred years, or on the next eight weeks — got the shortest answer in the episode: "Next hundred hours?"
Denning's opening line about the terms, "Broad strokes is all we've got," is also his description of what is publicly known about them
Laya noted that the announcement itself was made by Rodríguez, the interim president whose authority to make it is the thing being questioned
What the right of first refusal on the other 80% of production is for is Denning's own inference rather than a stated term — he said he assumes it would let the United States claim that oil if there were a major global disruption
The two of them describe the same deal from opposite ends and reach the same place: Denning says no Western oil company will commit 30 years to a venture backed by an unelected government and a president with two years left, and Laya says even a successful version of it adds 100,000 to 200,000 barrels of production and leaves US pump prices where they are.
Products, Companies & Tools Mentioned
North American Blue Energy Partners (The Venezuelan operator the US government is taking a 35% stake in; Denning said he has not seen a balance sheet for it, and Laya said it pumps about 200,000 barrels a day)
PDVSA (Venezuela's state oil company; Rodríguez ran it before becoming interim president, and it sits at the center of the money laundering allegations Laya said were investigated around Derwick)
Derwick (The company through which Betancourt won billions of dollars of emergency power equipment contracts from around 2009; it and Betancourt have denied the allegations)
Exxon (Said Venezuela was "basically uninvestable" after Maduro was deposed, which Denning said offended Trump)
Office of Strategic Capital (The Defense Department loan office through which the US stake runs; Denning said it is mainly for critical minerals and doubts the arrangement would survive a court challenge)
Books & Resources Mentioned
The White House fact sheet on the Venezuela deal (Denning said one line in it, calling large-scale oil investment a "key precondition to any kind of democratic transition," reveals the administration's order of priorities; Laya noted the same document restates support for the Chavista-opposition talks)
If this was worth your time, send it to someone who has to have a view on this.
Get the latest market chatter as it happens: