Oil-soluble catalysts could be of special significance for reducing the viscosity of heavy crude oil, because of their good dispersion in crude oil and high catalytic efficiency toward aquathermolysis. Ferric oleate was synthesized and applied as catalyst in the aquathermolysis reaction of Shengli heavy oil. It was found that ferric oleate was more efficient for heavy oil cracking than Co and Ni oleates. Besides, it was superior to oleic acid and inorganic ferric nitrate and achieved the highest viscosity reduction rate of up to 86.1%. In addition, the changes in the components of Shengli heavy oil before and after aquathermolysis were investigated by elemental analysis, Fourier transform infrared spectrometry, and ¹H nuclear magnetic resonance spectroscopy. Results indicated that ferric oleate contributed to a significant increase in the content of light components and decrease in the content of resin, N and S. The as-prepared ferric oleate showed good activity for reducing the viscosity and improving the quality of the heavy crude oil, showing promising application potential in aquathermolysis of heavy crude oil.