U.S. Energy Secretary: "U.S. to Intervene in Venezuela's Oil Industry to Expand Production"

Denial of Favoritism Allegations in Citgo Sale

Chris Wright, U.S. Secretary of Energy, announced on January 11 (local time) that the United States will intervene in Venezuela's oil industry to increase oil production.

In an interview with CBS that day, Secretary Wright stated, "U.S. involvement in Venezuela's oil industry will expand," adding, "You will see more U.S. companies entering the market and an increase in production."

Chris Wright, U.S. Secretary of Energy. Photo by Reuters Yonhap News

When asked whether the U.S. government would take ownership of Venezuela's state-owned oil company PDVSA, he firmly denied it, saying, "No." Secretary Wright explained, "Currently, we are managing their crude oil sales," and added, "We are blocking the overseas export of Venezuelan oil. All crude oil is traded through U.S. companies, and the resulting oil then enters the market."

Some observers have speculated that after the ousting of Venezuelan President Nicolas Maduro, the U.S. government will strengthen its control over PDVSA and directly secure and distribute the crude oil produced by PDVSA. In fact, the U.S. government has agreed to take delivery of 30 to 50 million barrels of Venezuelan crude oil. The previous day, President Trump signed an executive order to protect the proceeds from Venezuelan oil sales deposited in U.S. Treasury accounts from seizure or legal action.

Secretary Wright emphasized that the aim is to increase Venezuelan oil production to drive down oil prices, stating, "President Trump is not a supporter of the oil and gas industry." Generally, when oil prices fall, oil companies' profitability declines; however, President Trump's position to expand Venezuela's oil production indicates that he is siding with consumers who benefit from lower oil prices, rather than with the industry.

Addressing controversy over whether the sale of Citgo, a U.S. refinery owned by PDVSA, to Elliott Management-a hedge fund owned by Trump supporter Paul Singer-constituted special treatment, Secretary Wright countered, "I can guarantee there was absolutely no favoritism." He explained that the Citgo sale was "an auction open to all U.S. companies," and added, "We hope that American refining assets will be owned by Americans and that increasing processing capacity will help lower gasoline prices in the U.S."

Meanwhile, on the same day, President Trump stated on his social media platform Truth Social that the United States would protect Venezuela and block the flow of oil and funds from Venezuela to Cuba.

He said, "Venezuela no longer needs protection from the thugs and extortionists who held them hostage for years," adding, "Venezuela now has the United States, with the world's most powerful military, as its protector."