Donald Trump’s hopes for the future of Venezuela have been ridiculed by a Nobel Prize winner who called the vision an “unrealistic fantasy”.
Economist Paul Krugman dismissed Trump’s projection for Venezuela following strikes on the country by the US and capturing of President Nicolás Maduro. Writing in his Substack, the Nobel Prize winner suggested the “lucrative prize” Trump is holding out for in Venezuela is not as easy to achieve as the president is making it out to be.
Krugman wrote, “In short, Trump’s belief that he has captured a lucrative prize in Venezuela’s oil fields would be an unrealistic fantasy even if he really were in control of a nation that is, in practice, still controlled by the same thugs who controlled it before Maduro was abducted.”
Further claims made by Trump have “no basis in reality”, according to the economist, who warned a promise made to oil executives over financial reimbursement cannot be fulfilled.
Krugman wrote, “On Monday Trump suggested that he might reimburse oil companies for investment in the nation he claims — with no basis in reality — to control, reimbursing them for their outlays there.”
“That is, we’ve gone in a matter of days from big talk about huge money-making opportunities to a proposal to, in effect, subsidize oil-industry investments in Venezuela at U.S. taxpayers’ expense.”
The Nobel Prize winner went on to say Trump’s thoughts on oil as a “precious asset” for the US is majorly out of date. He wrote, “At a deeper level, Trump’s apparent belief that oil in the ground is a precious asset is decades out of date. These days oil is cheap by historical standards.”
“Oil prices are low mainly because of increased supply due to fracking, and the potential for more fracking is likely to keep them low for the foreseeable future.
“The breakeven price of fracked oil — the price at which it’s just profitable to drill a new well — is around $62 a barrel in the most important U.S. producing regions. While global oil prices fluctuate, they tend to return to that breakeven price after a few years:”
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