VENEZUELA IS AN ENORMOUS PRIZE
Don’t give Trump all the credit, or even most of it. He’s in power at the right time.
American oil would be booming without him thanks to the riches of US shale, Canadian heavy oil and discoveries in places like Brazil and Guyana. Ex-presidents Joe Biden and Barack Obama benefited, too.
What Trump has done is pull all of that petroleum under Washington’s security umbrella.
More than 200 years after US President James Monroe declared Latin America a sphere of influence for the White House, creating the Monroe Doctrine, Trump is updating it for the 21st century, hence the half-joking Donroe label. This time much of it is to do with natural resources.
For the new US foreign policy, every oil-rich nation in Latin America is important, but the prize of Venezuela is enormous.
This isn’t because of its current production: At about 1 million barrels a day it pumps significantly less than Brazil. It’s because of what it once produced – more than 3.7 million barrels a day at its 1970 peak – and could pump once more.
The geology is there. All that’s needed to unlock the nation’s oil wealth is capital, time and effort. At one point in the 1990s, Caracas had a plan to boost output first to 5 million barrels a day and then to 6.5 million. The arrival of Hugo Chavez, followed by Maduro, put an end to that.
Can Venezuela once again target those levels? Sure. Would they be achieved soon? A hard no. Can it be achieved in the next five years? Also unlikely.