US President Donald Trump has long been enamored with Venezuela's vast oil reserves, but it's unlikely that he'll secure a lucrative deal anytime soon. The issue is twofold: first, the global market is saturated with oil, making Venezuela's crude an unattractive investment opportunity; second, the country's decrepit infrastructure and lack of major investments render it unable to produce much oil.
To justify investing in greenfield projects, the price of Brent crude must reach at least $80 a barrel. However, prices have been hovering between $58.7 and $62.3 over the past month, far below this threshold. Even if there was demand for Venezuelan oil, the process of extracting it would be daunting.
As the US economy has become less dependent on foreign oil in recent decades, the economic benefits of acquiring Venezuela's resources are diminished. The country produces only 1% of world oil production and 4.3% of what the US pumped last year. Furthermore, crude oil is a resource that cannot be easily exploited; contracts would likely be abrogated by new governments, or worse, destroyed in conflict.
This reality was illustrated during the US occupation of Iraq, where ExxonMobil CEO Darren Woods advised Trump that Venezuela was "uninvestable." The country's experience with production disruptions and payment arrears has driven multinational oil companies away. It is likely safer for US firms to procure whatever oil they need domestically rather than risking investment in a troubled economy.
The US has a history of intervening in the oil industries of other countries, often using regime change as a means to secure access to valuable resources. However, even this precedent suggests that it's not worth the risk; Iraq, for example, showed that such attempts can backfire.
In conclusion, while Trump may still fantasize about Venezuela's oil riches, the economic case is weak, and the risks far outweigh any potential benefits. It's likely that US companies will continue to prioritize domestic production over investing in a troubled country with uncertain prospects.
To justify investing in greenfield projects, the price of Brent crude must reach at least $80 a barrel. However, prices have been hovering between $58.7 and $62.3 over the past month, far below this threshold. Even if there was demand for Venezuelan oil, the process of extracting it would be daunting.
As the US economy has become less dependent on foreign oil in recent decades, the economic benefits of acquiring Venezuela's resources are diminished. The country produces only 1% of world oil production and 4.3% of what the US pumped last year. Furthermore, crude oil is a resource that cannot be easily exploited; contracts would likely be abrogated by new governments, or worse, destroyed in conflict.
This reality was illustrated during the US occupation of Iraq, where ExxonMobil CEO Darren Woods advised Trump that Venezuela was "uninvestable." The country's experience with production disruptions and payment arrears has driven multinational oil companies away. It is likely safer for US firms to procure whatever oil they need domestically rather than risking investment in a troubled economy.
The US has a history of intervening in the oil industries of other countries, often using regime change as a means to secure access to valuable resources. However, even this precedent suggests that it's not worth the risk; Iraq, for example, showed that such attempts can backfire.
In conclusion, while Trump may still fantasize about Venezuela's oil riches, the economic case is weak, and the risks far outweigh any potential benefits. It's likely that US companies will continue to prioritize domestic production over investing in a troubled country with uncertain prospects.
I don't get why Trump still thinks Venezuela has super valuable oil 
. Like, we already have enough oil here in the states and abroad. And have you seen the state of their infrastructure? It's like they're asking to be taken over by someone else! 
The thought of investing all that money there is just too much risk for me. I'd rather US companies focus on making more oil here at home 
, where it's safer and we can get a better return on investment. And what's up with this whole "regime change" thing? That never ends well 
. Just leave Venezuela alone and let them sort out their own problems! 
Trump is still stuck on this idea of getting rich off it but honestly its not gonna happen . The prices are like half of what he needs and the infrastructure is shot . And let's be real , 1% of world production ain't gonna cut it . I mean I get it the US is less dependent on foreign oil now but that just means they got more stable options 
. It's not worth risking it for a country with so much uncertainty . Iraq showed us that taking over someone else's oil industry can be a total disaster 
, who thought acquiring venezuela's oil would be a good idea? 
like, i get it, trump likes the idea of getting rich off that country's resources, but like, the numbers don't lie 
. 1% of global oil production is barely scraping by 
, and they can't even keep up with basic infrastructure maintenance 
. and have you seen those prices lately? 
$58.7 a barrel? that's just crazy town 
. and don't even get me started on the whole brent crude thing 
. i mean, who wants to invest in a country where exxonmobil is basically saying "nope, not worth it"? 
, but let's just say the economic case is weak and the risks are real 
.
anyways, trump's all like "vz is gonna be a big deal" but idk 
but seriously venezuela's oil situation is super bleak right now they need like $80 a barrel just to make it worth investing but prices are all over the place rn and that's not even taking into account their infrastructure issues which are, well, pretty bad 
like how can you expect to pump out oil when your pipes are all messed up?
. The US should focus on its own domestic production rather than risking investments in a country with uncertain prospects 
its like he forgot about the global market oversaturation and venezuela's infrastructure disaster 
. I don't think it's worth the risk for US companies to try and invest in a country with such uncertain prospects 
. It's like trying to catch fish with your bare hands - just not worth the effort 
. I think Trump should focus on domestic production instead, we could use some of that oil energy here in the States 
️.
but that doesnt mean we should invest in a country that cant even keep its own infrastructure together 
$58-$62 a barrel? come on man! thats like buying a used car at a garage sale 
.
anyway its all good for us because we dont need venezuela's oil anymore our own resources are more than enough 
️. Plus, the US is all about domestic production these days – it's like they're trying to cut ties with Venezuela altogether 
. Like, remember Iraq? 
. I think Trump needs to focus on making America's own oil industry stronger instead 
.
. Plus, with US oil independence on the rise, it just isn't worth the risk