US President Donald Trump has announced a significant oil agreement with Venezuela, a move that comes as the conflict with Iran continues to strain global crude supply chains.

In a social media post on Friday evening, Trump stated that the US and Venezuela had finalized a petroleum-related deal, which would grant American interests "majority control" over more than 650 billion barrels of Venezuela's proven oil reserves. He hailed the accord as "the largest oil deal in world history," emphasizing that it would come at "zero cost" to American taxpayers.

The President revealed that the agreement was negotiated by Secretary of State Marco Rubio, Defense Secretary Pete Hegseth, and Venezuelan interim President Delcy Rodriguez. He also noted that US "partnerships" with several unnamed private companies were instrumental in securing the outcome.

Despite this development, WTI crude is on track for a weekly decline of 4%, marking its first losing week in three. Nevertheless, prices have surged more than 24% since the onset of the US-Iran war.

Energy Supply Strains and Depleting Strategic Reserves

The new deal arrives amid mounting pressure on US energy supplies. The war with Iran has severely disrupted crude shipments through the Strait of Hormuz, a chokepoint that previously carried roughly 20% of global oil trade. Daily vessel transits have plummeted from approximately 100 a year ago to just a handful now.

Simultaneously, US strategic petroleum reserves are critically low. According to data released earlier this month by the Department of Energy, reserves have fallen below 300 million barrels, a drop of over 100 million barrels since early 2026, marking the lowest level since the 1980s.

Trump asserted that the control of 650 billion barrels secured through this agreement would more than double the size of US oil reserves.

On the retail front, data from the American Automobile Association shows the national average price for regular gasoline hit approximately $4.09 per gallon on Friday, a 27% increase year-over-year.

With midterm elections approaching, Trump faces acute political pressure to reduce energy prices, as the outcome will determine whether Republicans maintain unified control in Washington. The President expressed confidence that the Venezuelan deal should help bring oil prices down.