President Donald Trump’s plans to restore Venezuela’s beleaguered oil industry faces a series of challenges that will cost U.S. oil companies many billions of dollars to overcome.
Over the weekend, U.S. forces arrested Venezuelan President Nicolas Maduro on drug trafficking charges, with Trump claiming the U.S. would “run” the country and take over the country’s nationalized oil reserves.
“American dominance in the western hemisphere will never be questioned again. Won’t happen,” Trump said on Saturday, while explicitly endorsing the “Donroe doctrine,” a social media meme/portmanteau that describes the retro-nostalgic version of imperial authority increasingly on display in his second term. The Monroe Doctrine meets the Donald.
The move follows a series of deadly strikes on Venezuelan boats supposedly carrying drugs, attacks widely considered to be illegal. The United Nations Secretary General António Guterres, the body’s top official, called Trump’s ousting of Maduro a violation of the UN’s charter.
Home to the world’s largest oil reserves, Venezuela reached its output peak in the 1970s, producing more than 3.5 million barrels of oil daily, though production has significantly tapered off to about 1 million barrels daily. Analysts have high hopes that oil companies entering Venezuela can tap back into the country’s black gold. JPMorgan predicted that with control of Venezuela’s oil, the U.S. could hold 30% of the world’s oil reserves. Other analysts said the country could double or triple its current output, returning it to its highs from 50 years ago, quite quickly.
