Trump’s Venezuela Oil Plan Runs Into Hard Reality

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that the South American country now pumps a fraction of what it used to, Trump said, “We’re going to have our very large United States oil companies — the biggest anywhere in the world — go in, spend billions of dollars, fix the badly broken infrastructure, the oil infrastructure, and start making money for the country.”While that sounds like a great opportunity for the US oil majors, it’s one they may want to refuse. Why? Because the oil underneath Venezuela, which has the largest crude reserves in the world, greater even than Saudi Arabia and Iran, is technically challenging to extract and costly.Moreover, it’s uncertain whether there would a change in the way Venezuela and its oil industry are being run, which presents a huge political risk for companies to return and operate there.Former President Hugo Chavez nationalized the oil industry in the 1990s, and in 2007, he forced Exxon and ConocoPhillips out, after the companies refused to accept new terms that would give the Venezuelan state oil company, PDVSA, a majority share in their projects.ConocoPhillips is still owed about $10 billion.Only Chevron is currently authorized to operate in Venezuela and export crude to the United States.“Until Caracas has a new government capable of gaining the confidence of international investors and banks, oil companies will be reluctant to make any major commitments,” states a recent Reuters piece.When Trump met with oil executives last Friday, Exxon’s CEO Darren Woods said, “We’ve had our assets seized there twice, and so you can imagine to re-enter a third time would require some pretty significant changes.”Trump has said the US government is prepared to provide security guarantees but not money for oil projects.How much oil does Venezuela have?A founding member of OPEC, Venezuela has more oil reserves than any OPEC member and top exporters in the Gulf, including Saudi Arabia, Iraq, the United Arab Emirates and Iran.The country is estimated to hold 303 billion barrels in proven reserves, about 17% of the world’s total, and more than five times the United States’ 55 billion barrels.Most is contained within the Orinoco Belt — a vast territory in eastern Venezuela stretching about 600 kilometers from east to west and 70 km from north to south, with an area of roughly 55,314 square kilometers.Terms and Privacy PolicyPrivacy & Cookie SettingsMore InfoS&P Futures6,965.50 -0.75 (-0.01%)Dow Futures49,336.00 -20.00 (-0.04%)Nasdaq Futures25,635.25 +4.25 (+0.02%)Russell 2000 Futures2,667.00 +0.90 (+0.03%)VIX16.75 +0.77 (+4.82%)Gold4,599.80 -35.90 (-0.77%)Trending tickersBTC-USD Bitcoin USD 96,392.03 +1,403.88 (+1.48%)ROLR High Roller Technologies, Inc. 18.89 +15.37 (+436.65%)RIVN Rivian Automotive, Inc. 17.50 -1.35 (-7.16%)MDB MongoDB, Inc. 386.89 -24.30 (-5.91%)TWLO Twilio Inc. 123.03 -6.80 (-5.24%)PortfolioSign in to access your portfolioSign inTop gainersCRML Critical Metals Corp. 17.93 +4.41 (+32.58%)BTDR Bitdeer Technologies Group 14.76 +1.99 (+15.58%)EWTX Edgewise Therapeutics, Inc. 28.17 +3.22 (+12.91%)LUNR Intuitive Machines, Inc. 19.76 +2.19 (+12.46%)VKTX Viking Therapeutics, Inc. 34.34 +3.65 (+11.89%)Top losersTCOM Trip.com Group Limited 62.78 -12.90 (-17.05%)DAVE Dave Inc. 185.46 -26.26 (-12.40%)VIA Via Transportation, Inc. 24.05 -2.82 (-10.49%)PSO Pearson plc 12.99 -1.40 (-9.73%)NAVN Navan, Inc. 15.66 -1.59 (-9.22%)Most activeNVDA NVIDIA Corporation 183.14 -2.67 (-1.44%)INTC Intel Corporation 48.72 +1.43 (+3.02%)BBAI BigBear.ai Holdings, Inc. 6.26 +0.17 (+2.79%)ONDS Ondas Holdings Inc. 13.56 -0.33 (-2.38%)PLUG Plug Power Inc. 2.3500 +0.0700 (+3.07%)Top economic eventsEarnings eventsMy earnings eventsEarnings events