Venezuela possesses the world's largest proven oil reserves, and its heavy crude oil is particularly well-suited for the sophisticated refineries along the U.S. Gulf Coast. More Venezuelan crude should theoretically help U.S. refineries, but this won't directly translate into lower gas prices at stations.

With 65 billion barrels of oil fields secured, increasing production won't be so simple.

President Trump announced last Friday (August 28) that the United States had gained majority control of Venezuela's more than 65 billion barrels of oil fields, stating that the agreement would significantly increase U.S. supply and substantially reduce gasoline prices "for a long time to come." On Sunday, he added another destination for Venezuelan crude: Washington will soon begin using it to replenish its strategic petroleum reserves. This agreement gives the U.S. access to a vast oil resource, but its impact on gasoline prices will depend on how much Venezuelan crude actually increases production and where that oil goes. According to Rystad Energy, Venezuela currently produces approximately 1.25 million barrels per day, while the new project aims for over 1.5 million barrels per day. Significantly exceeding this level will require more drilling, extensive well workover operations, improved infrastructure, reliable access to diluents, and a substantial increase in the number of drilling rigs.

Gulf refineries' favorite: Heavy crude oil is becoming scarce.

Venezuelan crude oil has become a significant component of the U.S. refining system. According to the U.S. Energy Information Administration (EIA), U.S. imports from Venezuela averaged 637,000 barrels per day in the four weeks ending August 21, reaching 662,000 barrels per day in the most recent week. During this period, Venezuela was the second-largest crude oil supplier to the U.S. after Canada. This crude has become even more valuable as the Iraq War disrupted flows of crude oil and heavy fuel oil from the Middle East. This is not just about filling lost production gaps. The Gulf Coast has spent decades building refineries capable of processing heavy, high-sulfur crude from Venezuela, Mexico, and Canada. Their delayed coking units convert residues from that crude into higher-value products such as gasoline and diesel. The shale boom once flooded the U.S. with light crude, but compared to Venezuelan Merey crude, which provides both crude oil and the large quantities of heavy feedstock needed to keep those facilities running, light crude produces far less residual feedstock. According to Rezidor, by 2028, heavy and extra-heavy crude oil and bitumen will account for about three-quarters of Venezuela's production, with the Orinoco Heavy Oil Belt accounting for about 60% of that. Therefore, increased Venezuelan production will provide Gulf refineries with a growing source of heavy feedstocks, which are precisely the feedstocks their most complex facilities are built for, while also intensifying competition with other heavy grades from countries like Canada.

The real bottleneck is in the refinery, not the oil field.

A more direct constraint on gasoline prices is refining capacity. In the week ending August 21, U.S. refinery utilization reached 97.4% , the highest in nearly eight years, with crude oil inputs reaching approximately 17.4 million barrels per day. Venezuelan crude can substitute for more expensive or less readily available heavy feedstocks and improve refinery profitability, but substituting one type of crude for another does not increase processing capacity. Moreover, this shortage is global. According to Kpler data, Middle Eastern refineries are operating at approximately 7.3 million barrels per day, down from 9.9 million barrels per day before the February war. From March to August this year, the region lost approximately 4 million barrels per day of refined product supply relative to pre-war levels, with about 2.5 million barrels coming from reduced refinery output. Kpler predicts that Middle Eastern refinery throughput will not fully recover to pre-war levels until the second quarter of 2027. The fuel market is pricing accordingly. According to S&P Global data, on August 25, the crack spread for Gulf diesel against West Texas Intermediate (WTI) crude reached $91.06 per barrel, compared to $30 a year ago; the gasoline crack spread reached $40.43, compared to $16.40 a year ago. S&P Global also provided two comparisons: ClearView Energy Partners estimates the current refined product shortage at 2 to 3 million barrels per day; the International Energy Agency (IEA) estimates that global refinery throughput will be reduced by 4.7 million barrels per day compared to 2025.

The White House is looking for a faster answer.

So, where exactly are we? The answer is: we're on a slow road to lower oil prices. More Venezuelan production could put some downward pressure on gasoline prices: additional crude would increase global supply and lower prices, while fiercer competition among heavier grades would reduce feedstock costs for Gulf refineries. However, the impact on gasoline prices is limited by the current shortage of refinery output, not crude oil. In other words, more Venezuelan crude could make oil cheaper, but it can't turn oil into gasoline. In the long term, a significant increase in Venezuelan production could put downward pressure on crude oil prices, and consequently, gasoline prices. But those crudes require years and billions of dollars in investment to develop, and the current fuel shortage is already costing American drivers: regular gasoline has now surpassed $4 a gallon, about $1 more expensive than a year ago. This has the White House eager to find a more direct answer. Trump is expected to meet with U.S. refiners and fuel retailers this week to discuss lowering gasoline prices, with companies like Valero, Marathon Petroleum, and PBF Energy expected to attend. This meeting comes at a time when refineries are recording strong profits from a tight fuel market, which is driving up gas station prices. Trump has publicly pressured the industry to take further measures to lower prices.

Conclusion

Venezuelan oil may eventually be part of the answer, but the new agreement is unlikely to increase production enough by November to substantially change the prices Americans pay at gas stations. The key words are "time" and "bottleneck": oil fields are in hand, but refineries are running at full capacity; no matter how much crude oil is available, it can't overcome the processing hurdle that determines gasoline production. For drivers, hoping for a significant drop in gas prices this winter will likely take some time.