Top Senate Democrats Challenge Legality Of Pentagon’s Planned Venezuela Oil Stake

Four top Senate Democrats are challenging whether the Pentagon has the legal authority to take a 35 percent stake in a Venezuelan oil producer.

Democratic Sens. Jeanne Shaheen of New Hampshire, Jack Reed of Rhode Island, Martin Heinrich of New Mexico and Elizabeth Warren of Massachusetts sent a letter Wednesday to Secretary of State Marco Rubio, Secretary of War Pete Hegseth and Energy Secretary Chris Wright, according to a Thursday release from Shaheen’s Senate Foreign Relations Committee office.

“The statute creating the Department of Defense’s Office of Strategic Capital does not explicitly provide authority to take equity stakes in private oil companies,” the senators wrote in the letter.

The office is authorized to issue and guarantee loans to private U.S. companies that develop critical technologies and strengthen the defense industrial base, the senators said, adding, “This deal is inconsistent with that authority.”

Tad DeHaven, a policy analyst at the libertarian Cato Institute, said in a statement to the Daily Caller News Foundation that “Congress hasn’t expressly authorized OSC [the Office of Strategic Capital] to take equity stakes, and the administration still owes us a clear legal explanation.”

“As with Intel and MP Materials, Washington is picking a corporate favorite and becoming its business partner,” DeHaven added. “In this case, protecting that company could also shape U.S. policy toward Venezuela.”

“The proposed agreement is unlikely to reduce high energy costs for Americans, and it risks undermining the Venezuelan people’s transition away from a dictatorship,” the senators wrote.

A Department of War official said on background in a statement to the DCNF that, as with all congressional correspondence, the department will respond directly to the letter’s authors.

The State Department, the Energy Department, North American Blue Energy Partners (NABEP) and the offices of Shaheen, Reed, Heinrich, Warren and Republican Kentucky Sen. Rand Paul did not immediately respond to the DCNF’s requests for comment.