President Trump said Tuesday that Venezuela would begin handing over oil worth up to $3 billion that Trump would dole out “to benefit the people of Venezuela and the United States.” On what legal basis this is being done and where exactly the money will go was not made clear by the president.
But for the people of Venezuela, here is what is certain: If you didn’t know before, now you know. Trump came to liberate your oil, not your people. Sorry to tell you, but last Saturday was “O-Day,” not “D-Day.”
It is now clear that Trump’s priority in capturing President Nicolás Maduro of Venezuela was not to make that country safe for the restoration of democracy but to make it safe for the restoration of American oil companies’ dominance over Venezuelan oil extraction. Trump probably hopes that if he can bring Venezuela’s massive, untapped oil reserves to market that he can drive the price of gasoline down at the pump toward $1 a gallon and win the midterms. But I don’t think that will be so easy. Here’s my prediction: Trump will soon discover that the only way to revive major American oil investments in Venezuela is to revive Venezuela’s democracy.
Why? Because our major oil companies are serious public companies with shareholders, and what company in its right mind would make a huge long-term investment in a country where the people who stole the last election are being kept in power — minus their leader — so they can take orders from our Don Trump rather than their Don Corleone? All this while the legitimate winners of their last election are in exile or out on the streets, angry, and not wanting this rump dictatorship to survive.
If you were running a major U.S. oil company, would you invest billions upon billions of dollars in a foreign country being run by remote control from the White House under the threat of force by Trump, Pete Hegseth, Marco Rubio and Stephen Miller? I wouldn’t invest in their lemonade stand.
Trump reportedly plans to meet representatives of the three largest U.S. oil companies at the White House on Friday to, I assume, make them an offer they can’t refuse — that is, an opportunity to place multibillion-dollar bets on fixing Venezuela’s oil sector, maybe with promises of U.S. government subsidies. Chevron is the only major U.S. oil company operating in Venezuela, maintaining a presence through a special U.S. license; ConocoPhillips and Exxon Mobil have been out of the country since their assets were nationalized in 2007. ConocoPhillips is currently seeking to recover approximately $12 billion in arbitration awards and interest, while Exxon Mobil has said the country owes it an estimated $20 billion.
I would love to be a fly on the wall at that White House meeting. Because after talking to people in the U.S. oil industry, it is clear to me that if Trump wants to see U.S. companies invest billions of new dollars to repair Venezuela’s oil infrastructure, the first thing they will tell him is that they need a return to the rule of law in Venezuela. They will also tell him they need physical security on the ground for their people, a stable government, repayment of the debts owed for expropriated assets, a new law governing how oil profits will be shared — not according to Trump’s whims — and an agreement that any disputes will go to international arbitration, not local courts.
If I were the oil companies, I’d also want to see Venezuela with a democratically elected government that represents the will of the people, a government that can legitimately enter into the only kind of contracts that U.S. oil investors are interested in — long-term, profitable, stable and secure, with terms that a majority of Venezuelans would be likely to support.
I am not saying that the oil companies are crusaders for democracy. These companies are obsessed with stability, not democracy. There is no way a country ruled by an illegitimate, Trump-directed cabal of mini-Maduros — who are allowed to keep their jobs and freedom as long as they do Trump’s bidding — would be a stable place. Remember, Venezuela’s opposition was estimated to have won almost 70 percent of the votes in the last election, yet it is being stiff-armed by Trump, who appears to want to deal only with Venezuelan lackeys, not liberals.
Basically, our oil companies are being told to invest in a country where the Trump mob will be telling the Venezuelan mafia what to do. Gosh, what a great opportunity! Oh, and I forgot to mention, shortly after Trump took control of Venezuela, he was talking about doing the same to Greenland. Who is going to oversee all of this?
After the U.S. captured Maduro and his wife last Saturday and took them to New York for criminal prosecution, Trump said his team would “run” Venezuela with the cooperation of Delcy Rodríguez, Maduro’s vice president, who has become the country’s acting leader. When she initially signaled that she would not simply obey orders from Washington, Trump said, “If she doesn’t do what’s right, she is going to pay a very big price, probably bigger than Maduro.” Rodríguez then softened her stance, but on Tuesday night several thousand Maduro supporters took to the streets of Caracas to denounce the U.S. president. Watch that space.
Meanwhile, the Venezuelan opposition leader María Corina Machado, recipient of last year’s Nobel Peace Prize, called Rodríguez in an interview with Fox News “one of the main architects of torture, persecution, corruption, narco-trafficking” and a key ally of Russia, China and Iran who could not be trusted by investors or Venezuelans. (That’s Trump’s partner!) Machado added that she intends to return to Venezuela from exile to bolster the opposition.
“We won an election by a landslide under fraudulent conditions,” Machado said. “In free and fair elections, we will win by over 90 percent of the votes, I have no doubt about it.” It is widely accepted that Edmundo González, who ran for president as a stand-in for Machado after Maduro’s government barred her from running, won more than two-thirds of the 2024 vote. But among Trump’s reasons, he reportedly does not prefer Machado for president because she won the Nobel Peace Prize instead of him (though he claims this didn’t factor into his decision to back Rodríguez).
I repeat: if you were a major U.S. oil company, would you step into the middle of such a circus with billions of dollars of investments, when there are so many other more stable places to invest? I will not be watching what the oil executives tell Trump Friday to get him off their backs, but I will be watching what they do with their money and what they tell their shareholders on their next earnings calls.
“Venezuela’s oil infrastructure is so degraded by years of neglect, and its business environment so difficult to navigate due to decades of corruption and poor governance, that the scale of investment required to revive production, refinement and exports is vast — typical estimates being north of $100 billion over 15 years,” John Rapley, an expert in the global political economy, wrote in an essay in UnHerd.
With projects already underway elsewhere, it’s not clear what advantage the major U.S. oil companies would gain “from suddenly reallocating capital to Venezuela,” he wrote, pointing out that “the longtime horizons involved would require a stable, predictable environment before the majors feel comfortable sinking money again. Which is to say, a regime change. And what happened on Saturday fell far short of that.”
Trump and his deputy chief of staff for policy, Stephen Miller, think they know how the world really works — the strong do as they like and the weak bow as they must. I guess they missed the insurgencies against the U.S. military in Iraq and Afghanistan by ragtag militias that drove us out of both places. Trump and Miller live their lives today surrounded by sycophants, and neither of them has ever lived abroad, so neither has any feel for how people can and will resist — sometimes openly, sometimes covertly — when they are humiliated by big tough foreigners telling them what to do.
Trump thinks free and fair elections are a distraction for getting Venezuela’s oil sector up and running. I disagree. I think they are a prerequisite. No real elections for Venezuela, no big American investments, no real increase in oil exports.
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