President Donald Trump said Saturday that ousting Venezuelan President Nicolás Maduro will open the door to the country’s vast oil reserves, a move that has the potential to reshape the global energy market.
“We will have our very large oil companies in the United States, the largest in the world, step in, spend billions of dollars, fix the badly broken infrastructure and start making money for the country,” Trump said in a public speech.
“They pumped almost nothing compared to what they could have been,” he said.
Trump’s comments came just hours after a stunning raid early Saturday in which US forces and law enforcement captured Maduro and hit parts of the capital Caracas.
Defense Secretary Pete Hegseth praised US forces for carrying out a nighttime operation to arrest Venezuelan President Nicolás Maduro and his wife. “Our adversaries remain on notice: America can project our will anywhere, anytime.”
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Venezuela’s vast oil reserves are the largest in the world, probably the equivalent of about 300 billion barrels, according to the Energy Institutea research agency. Its reserves are greater than those of even OPEC’s largest oil-producing country, Saudi Arabia.
But this would likely require years of work and significant investment to modernize the industry, according to the U.S. Energy Information Administration, something that will also require some level of political stability. Trump said in his public speech that the US would “govern” Venezuela for the time being, but did not specify who would be involved or how.
“We built the Venezuelan oil industry with American talent, drive and skill, and the socialist regime stole it from us,” Trump claimed. “This was one of the largest thefts of American property in our country’s history.”
Trump said the embargo he imposed on oil from Venezuela remains “in full force and effect.”
“They stole our oil,” he added. “They took over like it was nothing.”
“We’re going to sell large amounts of oil to other countries,” Trump said when asked how controlling Venezuela’s energy supply could affect relations with China, Russia and Iran. “We are in the oil business. We are going to sell it to them.”
Venezuela has enjoyed decades of economic success thanks to its oil, which it supplies to various trading partners. China is currently Venezuela’s largest oil customer, according to analysts, but the secretive nature of some of those exports makes exact data difficult to obtain.
Any US attempt to gain access to Venezuela’s oil could also further inflame tensions with China, which strongly condemned Maduro’s removal.
“Such hegemonic acts by the US are a serious violation of international law and Venezuela’s sovereignty, and threaten the peace and security of Latin America and the Caribbean,” the Chinese Foreign Ministry said. said Saturday. “China is firmly against it.”
Chevron is the only U.S. oil company operating in Venezuela, under a limited license granted to it by the Trump administration. A more involved plan, like Trump’s, would likely require more companies to enter the country.
“Chevron remains focused on the safety and well-being of our employees, as well as the integrity of our assets,” a company spokesperson said Saturday morning. “We continue to operate in full compliance with all relevant laws and regulations.”
Major US involvement in Venezuela’s oil sector could transform the industry and energy markets, although the infrastructure to drill, store and export that oil could take years to build.
Venezuela’s vast reserves are heavily concentrated in one part of the country. Tapping that supply would be technically feasible, but likely very costly because of the years of decline the country’s energy infrastructure has suffered as a result of an economy weakened by tough U.S. sanctions.
“The majority of Venezuela’s proven oil reserves consist of extra-heavy crude oil,” the report said research from the US Energy Information Administration.
“The extraction of extra heavy crude oil requires a higher level of technical expertise, which international oil companies possess, but their involvement is limited by international sanctions,” the agency said. “In addition, budgetary constraints at Venezuela’s state oil company PDVSA and a lack of qualified technical personnel and foreign direct investment have all hampered Venezuelan oil and natural gas development.”
Defense Secretary Pete Hegseth discusses the US mission in Venezuela that captured Nicolás Maduro and his wife.
These sanctions and budget restrictions still make PDVSA the largest source of revenue for the Maduro government.
However, the infrastructure is decades old and is complicated by the extra heavy crude oil. The EIA estimates that many of Venezuela’s oil pipelines are more than 50 years old.
Restoring the country’s oil production to 1990s levels would require more than $8 billion in investments, EIA said, citing PDVSA estimates.
“The bones of a great oil industry are certainly there,” longtime oil industry analyst John Kilduff told NBC News.
“There could be a small increase in their production over the next six months,” Kilduff added, noting that the additional production could help with the recent downward trajectory in consumer gas prices. “So yes, US consumers could see further declines at the pump, on top of what they have already seen in recent months.”
“Venezuela oil is of a special quality. It is very heavy and acidic, especially suitable for oil refineries on the US Gulf Coast,” he said.
For the time being, the impact on the market is unclear. Crude oil trading will not resume until Sunday evening.
Terry Haines, founder of Pangea Policy, said in a remark on LinkedIn that oil prices are likely to ‘react negatively’ [the market] a greater supply is likely.”
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