Pentagon's 35% Venezuela Oil Stake Risks Climate Goals

For climate and energy professionals, the deal represents a troubling fusion of national security capital and hydrocarbon expansion. If the U.S. government becomes the equity backer of Venezuela's oil industry, it signals that fossil fuel production—not decarbonization—remains the strategic priority for this administration.

On September 4, 2026, President Donald Trump announced on social media that the United States and Venezuela had reached what he called "THE BIGGEST OIL DEAL IN WORLD HISTORY." In a syndicated column published the next day, Jonah Goldberg argues that Americans should scrutinize the fine print, because the arrangement is not a conventional trade or private investment deal. According to Goldberg, citing The Wall Street Journal, the two sides will work through two intermediaries: Venezuelan businessman Alejandro Betancourt's North American Blue Energy Partners, and, on the U.S. side, the Pentagon's Office of Strategic Capital (OSC). The OSC would take a 35% equity stake in Betancourt's firm and secure the right to buy 20% of all production "at cost."

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According to Goldberg, citing The Wall Street Journal, the two sides will work through two intermediaries: Venezuelan businessman Alejandro Betancourt's North American Blue Energy Partners, and, on the U.S.

This structure is significant because OSC was created in 2022 as a lending and loan-guarantee body to support vital industries, not to take direct equity stakes in foreign energy ventures. The deal also inserts the U.S. military apparatus into a commercial oil partnership with a figure who has been investigated, though not charged, for money laundering in Spain and Switzerland. Betancourt, described as one of the "Bolichicos" who prospered through ties to the Venezuelan socialist regime, is a controversial partner. Meanwhile, ExxonMobil CEO Darren Woods had told the White House in January 2026 that Venezuela was "un-investable," which Goldberg says infuriated the president and helped drive the administration toward public financing.

The legal basis for the deal is questionable. The OSC was designed for loans and loan guarantees, not for equity investments in a foreign company. Using it as the primary backer of a massive oil deal under what Goldberg calls "implausible statutory authority" invites immediate court challenges. The U.S. government would also be working with what the columnist describes as a criminal regime, buying oil at below-market rates while potentially undermining American oil producers. For taxpayers, the arrangement shifts capital risk onto the public balance sheet in a decrepit oil industry with a history of expropriation, corruption, and mismanagement. If production does not materialize or the political situation deteriorates further, the OSC could face losses or be required to provide security guarantees that blur the line between commercial and military activity.