Three months after U.S. special forces extracted Venezuelan President Nicolás Maduro from Caracas in a nighttime raid, the Trump Administration’s handling of billions of dollars in Venezuelan oil revenue has become the subject of Congressional scrutiny. Questions are being raised as the administration scrambles to unlock Venezuelan crude to offset a fuel crisis driven by the U.S. attack on Iran.

Democrats in Congress are pushing for answers on how the administration is managing hundreds of millions in Venezuelan oil revenue. On Jan. 28, Secretary of State Marco Rubio testified before the Senate Foreign Relations Committee that the first $500 million in proceeds from Venezuelan oil sales were being routed through an offshore account in Qatar, with the State Department monitoring and approving disbursements. Rubio called the arrangement “novel” and “a short-term mechanism.”

After calls for investigations and a Senate bill that would require disclosure of these funds, Energy Secretary Chris Wright on Feb. 13 said the revenue, which at the time had reached over $1 billion, had been moved to an account managed by the U.S. Treasury. Wright told NBC News that Venezuela owes tens of billions to creditors after it defaulted on its sovereign debt. In 2007, the country seized assets of oil companies ExxonMobil and ConocoPhillips when it nationalized its oil industry under former President Hugo Chávez.

“Since Venezuela has so many creditors and they owe a lot of money, we had some risk if we put it into a U.S. bank account set up quickly that creditors could freeze that money,” Wright told NBC News. “We want those creditors ultimately to get their money back, but that money urgently needs to get to Venezuela.”

However, details about how the Trump Administration is managing those funds remain scarce. U.S. Democratic Rep. Sean Casten of Illinois and Sen. Chris Van Hollen, a Maryland Democrat, pressed for answers in a March 10 letter.

“Regardless of whether the Qatari bank account has been wound down, it is important that the Administration produce related documents, submit to congressional oversight, and provide the American people with much-needed transparency on this opaque and legally questionable plan,” the lawmakers wrote.

In mid-February, Democratic Sen. Adam Schiff of California and Senate Minority Leader Chuck Schumer introduced the Venezuela Oil Proceeds Transparency Act. It would direct the Government Accountability Office to conduct an independent audit of the entire offshore arrangement, including which companies had been awarded licenses to trade Venezuelan crude and on what terms.

Rep. Robert Garcia, the top Democrat on U.S. House Committee on Oversight and Government Reform, also demanded answers in a January letter about the two companies initially awarded Venezuelan oil licenses — commodities traders Vitol and Trafigura. Both companies had been implicated in prior Justice Department bribery investigations. The administration directed $250 million in oil proceeds to Vitol, according to the Financial Times, which reported that a senior trader for the company, John Addison, had donated $6 million to Trump’s 2024 presidential campaign.

“President Trump has argued that his personally controlling millions in Venezuelan oil proceeds through an offshore account benefits Americans and Venezuelans, but his actions suggest otherwise,” said U.S. Rep. Lloyd Doggett, a Texas Democrat who has also pushed for transparency on Venezuelan oil revenue. “He is unlawfully refusing to honor debts owed to U.S. institutions by the Chavista regime and instead appears to be rewarding his donors.”

However, the administration last month lifted sanctions on Venezuela’s oil put in place in January 2019, during Trump’s first term. The move allows U.S. oil companies to invest in producing more oil from Venezuela, whose production rose to more than 1 million barrels per day in March, according to Reuters.  

Last week, the administration also lifted sanctions on Venezuela’s Acting President Delcy Rodríguez , Maduro’s former second-in-command. The move represents a stark shift from the administration’s stance on Venezuela prior to Maduro’s ouster, even though Rodríguez represents a party dominated by Maduro loyalists.

The shift is likely a reaction to the fallout from the war in Iran, which the International Energy Agency has described as the largest supply shock in the history of the global oil market. On Feb. 28, the U.S. and Israel launched Operation Epic Fury against Iran. Tehran’s response effectively shut down the Strait of Hormuz, a critical chokepoint for about a fifth of the world’s oil supplies.

Roughly 20 million barrels per day of crude normally transit the Strait. Iran’s closure has removed an estimated 4.5 to 5 million barrels per day from the market so far, with analysts warning that figure could double by mid-April.

Oil prices have been rising since. West Texas Intermediate crude, which started the year near $59 per barrel, is now trading above $100. The price of North Sea Brent oil, often used as a global benchmark, has topped $112. In the U.S., the national average price of gasoline crossed $4 per gallon on April 1 for the first time since 2022, with California stations averaging nearly $5.90.

Against that backdrop, the Treasury Department issued a broad authorization in March allowing Venezuela’s state oil company, PDVSA, to sell crude directly to U.S. companies and on global markets — a seismic shift after years of blocking such transactions.

But can Venezuelan oil actually reduce global oil prices? The math is challenging. Venezuela currently produces less than 1 percent of global supply. That is about the same as Algeria and less than produced by Libya or Nigeria.

Luisa Palacios, former chair of Citgo Petroleum, which until recently was controlled by the Venezuelan government, said the country’s production fell by 1.5 million barrels per day under the Maduro administration “due to mismanagement of the industry, expropriation of oil assets, default of the country’s external debt, and severe deterioration in the industry’s governance and operational standards, in addition to oil sanctions.”

The U.S.’s removal of sanctions could bring the country’s output back to pre-2019 sanctions levels of roughly 1.5 million barrels per day within about two years, said Palacios, now a researcher at Columbia University’s Center on Global Energy Policy, said in a January Q&A. It could take a return of private investment and seven to 10 years to ramp up to about 3.5 million barrels per day.

Wood Mackenzie analysts have suggested that operational improvements in the Orinoco Belt, a massive deposit of heavy oil along the country’s coast, could push output toward 2 million barrels per day within about two years under the most favorable conditions.

None of that is likely to affect prices this year. To help deal with the oil crisis growing out of the Iran war, the Trump Administration released 400 million barrels from the Strategic Petroleum Reserve, the largest such release on record. The administration also temporarily lifted sanctions on some Russian and Iranian oil to provide market breathing room.

It is unclear whether international oil companies will commit billions for long-term operations until they have more certainty about U.S. policy toward Venezuela and what the country’s government will look like. Rodríguez, Venezuela’s acting president, has a 90-day mandate as acting president, granted by a Maduro-loyal high court, that expires this week. The National Assembly — presided over by her brother, Jorge Rodríguez — has the authority to extend it for another three months. Maduro himself remains legally president according to Venezuelan courts, even as he awaits trial in New York.

The Trump Administration recognized Delcy Rodríguez as the “sole Head of State” in federal court proceedings last month, but has simultaneously maintained that elections and a democratic transition will take place during Trump’s term, without specifying a timeline.

Mike Wirth, CEO of Chevron, the only U.S. oil major that kept pumping oil in Venezuela under a special Treasury license, said at a recent industry event that “there is uncertainty in the law” that is making the country’s political future – and viability for increased oil production – unpredictable, according to the Wall Street Journal.  

Lead photo: A mural representing U.S. President Donald Trump carries the phrases "No more kings" and "No more war for oil" on a sidewalk in Caracas, Venezuela, on March 16 (AP Photo/Ariana Cubillos).