THE GIST

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ExxonMobil CEO called Venezuela "uninvestable," and then Chevron came investing. Oil major Chevron committed more than $7 billion over the next five years to expand its Venezuelan operations, aiming to more than double production to roughly 600,000 barrels per day.

WHAT HAPPENED

President Trump is taking over all of Venezuela's oil reserves and bringing his friends along for help. After he called it the "biggest oil deal in the world," Trump's dramatic usurping of Venezuela's oil sector already has sponsors. Chevron is upping its commitment in the country, with an updated joint-venture agreement with Venezuela's state oil company, PDVSA. This gives it new acreage in the Orinoco Belt and revised fiscal and legal terms designed to pump in more money.

With the new money, Chevron is targeting a jump from roughly 280,000-300,000 barrels a day currently to about 600,000 barrels a day within five years, while keeping costs below $20 a barrel.

WHY IT MATTERS

Chevron is notable as the only major U.S. oil company that maintained a continuous presence in Venezuela through years of sanctions and political turmoil. Other American producers have so far stayed on the sidelines despite the administration's push.

It's not a coincidence that this announcement is timed with Trump's oil deal with Caracas. The U.S. will secure majority control over 65 billion barrels of Venezuelan reserves, or about one-fifth of the country's estimated 303 billion barrels. It will be through a private venture called North American Blue Energy Partners, which received 100-year concessions on 17 oilfields from Venezuela's interim government. NABEP, in turn, gave the U.S. Defense Department a 35% equity stake in that venture.

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America wants Venezuelan oil and it plans to get it all. Chevron's deeper involvement and the Pentagon's NABEP arrangement makes Washington an equity owner in the Venezuelan oilfields. This isn't unusual for the U.S. though: the blending of U.S. military and commercial interests taking over a foreign country's natural resources.

Venezuela's oil market has been collapsing over a decade of mismanagement and sanctions, and Caracas is treating Washington as a welcome savior. Even as the majority of its population stands in opposition.