5 issues to learn about oil in Venezuela : NPR

Hours after the U.S. navy captured Venezuelan president Nicolás Maduro, President Trump made it clear that the U.S. operation is about — a minimum of partially — management of Venezuela’s oil.

“We’ll have our very giant U.S. oil firms, the largest wherever on the earth, go in, spend billions of {dollars}, repair the badly damaged infrastructure, the oil infrastructure, and begin creating wealth for the nation,” Trump stated throughout a press convention Saturday.

The seize of Maduro and Trump’s feedback comes at a time when even a rustic like Venezuela — with one of many greatest oil assets on the earth — is not a positive guess for attracting main oil firms.

Many oil firms have been bruised by their previous experiences working within the nation. The worldwide oil market is at present going through an oversupply. Oil costs are under $60 a barrel, and long-term projections for oil demand are unclear because the world shifts to extra electrical automobiles.

Trump guarantees to “run the nation” and make means for U.S. oil firms in Venezuela. Nevertheless, there is a lengthy historical past of U.S. interventions in Latin America and the Center East not going nicely, oil specialists inform NPR.

Here is what it is advisable to learn about Venezuela’s oil.

Venezuela has enormous oil reserves, however now produces a fraction of what it used to

Venezuela was as soon as one of many greatest world oil producers and was one of many fundamental founders of the Group of Petroleum Exporting Nations (OPEC), a gaggle of a few of the world’s greatest oil producers, whose choices assist decide world oil costs. Venezuela has the largest confirmed reserves of oil on the earth, based on OPEC.

However whereas the nation was producing greater than 3 million barrels a day just a few many years in the past, in the present day Venezuela produces solely about 1,000,000 barrels a day, or roughly 1% of world oil output. The U.S. produces about 13 million barrels a day.

A lot of Venezuela’s oil went to refineries within the U.S. Now a lot of it goes to China.

Not all crude oil is similar — some oil is bodily lighter and simpler for refineries to course of. Venezuela’s oil is heavy and dense, and requires particular refineries. Burning any sort of oil contributes to local weather change, however Venezuela’s oil is “among the many dirtiest oils on the earth to provide in relation to world warming,” says Paasha Mahdavi, affiliate professor of political science on the College of California, Santa Barbara.

The El Palito refinery rises above Puerto Cabello, Venezuela, Sunday, Dec. 21, 2025.

Matias Delacroix/AP Photograph

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Matias Delacroix/AP Photograph

Venezuela owes some U.S. oil firms billions

U.S. oil firms like Chevron started drilling in Venezuela about 100 years in the past and performed a key function in growing the nation’s oil sector.

However round 2004 to 2007, then-President Hugo Chávez “principally forcefully renegotiated contracts” with worldwide oil firms, says Francisco Monaldi, director of the Latin America Power Program on the Heart for Power Research at Rice College.

ExxonMobil and ConocoPhillips left the nation in 2007 after which took the Venezuelan authorities to worldwide arbitration courts. The courts ordered Venezuela to pay ConocoPhillips over $10 billion and ExxonMobil over $1 billion. Venezuela has solely paid a fraction of these sums to ExxonMobil and to ConocoPhillips.

Chevron, nevertheless, stayed in Venezuela — though “ they did not prefer it,” says Gerald Kepes, president of Aggressive Power Methods, an vitality consultancy in Washington, D.C.

Chevron in the present day produces a few quarter of Venezuela’s oil.

In response to the information of Maduro’s seize, Chevron spokesperson Invoice Turenne stated in an e-mail, “Chevron stays targeted on the protection and wellbeing of our staff, in addition to the integrity of our property. We proceed to function in full compliance with all related legal guidelines and rules.”

Trump has stated that Venezuela has “stolen” U.S. funding within the nation’s vitality sector.

Will U.S. oil firms return?

Venezuela is what the oil business calls a “brownfield” — which means it is nicely established, and oil firms have a reasonably good thought of what they may discover once they drill. For firms like ConocoPhillips, returning to Venezuela may very well be a chance to recoup a few of the billions owed to them by the federal government, Monaldi says.

In an e-mail, ConocoPhillips spokesperson Dennis Nuss wrote, “ConocoPhillips is monitoring developments in Venezuela and their potential implications for world vitality provide and stability. It might be untimely to take a position on any future enterprise actions or investments.”

ExxonMobil didn’t reply to a request for remark.

Nonetheless, this is not the perfect time so as to add to the worldwide oil provide, Monaldi says. There’s at present a worldwide glut of oil. Additionally, as a result of Venezuela’s oil is especially dangerous for the local weather, that makes it much less engaging for European oil firms with local weather targets, Monaldi says.

Aerial view of a ship on the Demerara river in Georgetown, Guyana on August 29, 2025.

JOAQUIN SARMIENTO/AFP through Getty Photographs

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JOAQUIN SARMIENTO/AFP through Getty Photographs

Venezuela’s neighbor is a rising oil star

Subsequent door to Venezuela is Guyana — a rustic that lately found over 10 billion barrels of oil and is a key rising participant within the worldwide oil business.

Guyana’s oil is lighter than Venezuela’s, much less polluting, and has decrease taxes than Venezuela, Monaldi says. There’s additionally no nationwide oil firm in Guyana, as there’s in Venezuela.

“All that makes for Guyana to be one of the vital engaging oil locations on the earth,” Monaldi says.

Whereas ExxonMobil is not in Venezuela, it’s a main participant in Guyana.

For years, Venezuela and Guyana have had a territorial dispute that has additionally been associated to grease rights. Final March, Venezuelan vessels entered Guyanese territorial waters approaching offshore oil vessels belonging to ExxonMobil.

“Indubitably, with a altering regime, Guyana ought to really feel safer,” Monaldi says.

Lack of political stability may very well be a deal breaker 

Some improve in Venezuela’s oil manufacturing might occur pretty rapidly with extra monetary help and improved administration, based on an evaluation by Wooden Mackenzie, an vitality consultancy.

However Mahdavi says the Trump administration’s plans to jumpstart the business will probably be tough. He notes that it took practically 20 years to revitalize Iraq’s oil business after the U.S. invasion, although corruption and mismanagement stay pervasive.

And finally, notes Kepes, if it is unclear who’s in cost in Venezuela, oil firms could have issues concerning the long-term viability of their contracts. “Nobody’s going to begin investing on the bottom in a spot the place there is not any authorized contract and viable permission to function or if there’s issues about political stability and violence,” he says.