Hours after Nicolás Maduro was captured by US special forces in Venezuela and indicted on drugs, weapons and “narco-terrorism” charges, Donald Trump spoke extensively about his plans for something else entirely: oil.
Venezuela’s oil reserves – reputedly the world’s largest – are set to be pumped by a parade of powerful US oil companies, according to the US president, most of whom have not operated in the country in decades.
“The oil companies are going to go in and rebuild their system,” Trump said on Sunday, describing oil’s nationalization in Venezuela as “the greatest theft in the history” of the US. “They took our oil away from us,” he declared.
US oil giants have been largely silent about Trump’s claim they will rush into Venezuela and invest billions of dollars in the process. Analysts are skeptical of the president’s vision of a significant increase in oil production in the country within 18 months. It’s far from the first time the industry has been at the center of global conflict.
Though Trump is expressing dreams of a US business takeover of Venezuela’s oil, such ousting of dictators from petrostates has not historically guaranteed a boom in production, according to data.
Venezuela
While oil giants enjoyed a boon with Venezuelan oil in the late 1990s, by the mid-2000s, production started to fall as then Venezuelan president Hugo Chávez increased government control over the industry and drove out many foreign oil companies.
The US had sanctions on Venezuelan oil from 2005 until 2022, when they were narrowly lifted to allow Chevron to resume oil production in the country, following Russia’s invasion of Ukraine. Chevron is the only US oil company operating in Venezuela.
While Trump is bullish about the opportunities presented by the country’s oil, some analysts have questioned whether large oil companies will rapidly re-enter Venezuela and invest heavily in operations there should it continue to face political instability.
Iraq
It took several years after the US invasion of Iraq and the fall of Saddam Hussein in 2003 for oil production in the Middle Eastern country to rebound. International oil companies restarted oil production in the country starting in 2009, when Iraq’s then prime minister, Nouri al-Maliki, invited companies to purchase licenses.
By 2024, Iraq was the second-highest crude oil producer in the Opec oil cartel, after Saudi Arabia. Oil production drives the country’s economy, although water shortages and ongoing political instability have caused major oil companies to start pulling back production in the country.
Libya
Libya is an altogether different story. Over a decade after Muammar Gaddafi, its longtime dictator, was killed in 2011 by rebel militias who had received support from the US government, oil production in the country has never recovered. It continues to heavily fluctuate, due to political turmoil.
The country is now effectively ruled by two separate governments, who use oil exports – the country’s dominant source of income – as leverage in conflicts. While a ceasefire in 2020 led to a rapid rise in oil production, things still remain in flux.
In late 2021 and 2022, armed militants and blockade protests led to a slight dip in production. The US Energy Information Administration notes that oil development and exploration in the country is constrained because of this ongoing volatility.
