Former US President Donald Trump has declared that the United States will temporarily "run" Venezuela following the capture of its leader, Nicolas Maduro, with a clear focus on accessing the nation's colossal oil wealth.
The Strategic Prize: World's Largest Oil Reserves
Venezuela sits atop the single largest proven oil reserves on the planet. According to figures from the Energy Institute, these reserves constitute approximately 17% of the global total, equivalent to a staggering 303 billion barrels. However, decades of corruption, underinvestment, and sanctions have crippled the industry's output.
While the country pumped up to 3.5 million barrels per day in the 1970s, production collapsed to an average of just 1.1 million barrels daily last year. This represents a mere 1% of worldwide production, a fraction of what a resource-rich state like Saudi Arabia achieves.
Why American Refineries Crave Venezuelan Crude
The US motive extends beyond simple acquisition. As explained by analysts, the United States, while the world's top oil producer, faces a specific refinery dilemma. America predominantly extracts light crude oil, but its extensive refinery network along the Gulf Coast, particularly in Texas and Louisiana, is engineered to process heavy, viscous crude.
Retooling these multi-billion-dollar facilities is prohibitively expensive and slow. Consequently, the US remains dependent on imports to feed its refineries, bringing in over 6,000 barrels of heavy oil daily. Venezuela, alongside Canada and Russia, holds some of the world's most significant deposits of this specific heavy crude, making it a strategically logical, if controversial, supplier.
"The upshot is that for all that America theoretically pumps more crude oil than it would ever need out of its own territories, it is still totally dependent on trade to meet its demands for heavy oil," noted one economics editor.
Logistical Hurdles and Industry Caution
Despite the clear incentive, Mr. Trump's ambition to swiftly restart and control Venezuelan oil flow faces immense practical challenges. A comprehensive US embargo on Venezuelan oil remains in full effect, and years of mismanagement have left infrastructure in a dire state.
Industry analyst Peter McNally of Third Bridge warned that reviving the sector "will take tens of billions of dollars" and years of work. The response from the oil industry has been muted. Only one US energy giant, Chevron, currently operates in Venezuela. A Chevron spokesperson stated the company remains focused on safety and regulatory compliance, while other majors like ExxonMobil and ConocoPhillips have not publicly clarified their positions.
Mr. Trump, however, has dismissed cost concerns, asserting that the US occupation "won't cost a penny" as the nation would be reimbursed from "money coming out of the ground." He has vowed "to take back the oil that, frankly, we should have taken back a long time ago."
The majority of Venezuela's reserves consist of heavy oil located in the Orinoco Belt. While technically simpler to extract, this oil is expensive to produce. With China now the primary destination for Venezuelan oil due to US sanctions, any American-led overhaul would fundamentally reshape global energy trade routes and geopolitics.
