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U.S. President Donald Trump has made his objective in Venezuela clear: it’s about the oil.
Following the capture of President Nicolás Maduro, global attention has shifted to the White House’s next move in the region. To understand the stakes of this transition, here are six charts that illustrate the scale and significance of Venezuela’s oil reserves.
Hobbled oil production
Venezuela’s oil production has been in decline since the middle of the last decade, falling to its lowest point in 2020 when tighter U.S. sanctions and the pandemic choked demand. Since then, oil production has seen modest rebounds.
Tanked economy
The country’s economic health is directly tied to its ability to sell oil. As oil production collapsed in the second half of the 2010s, its economy shrank at an astonishing rate, contracting some 30 per cent in 2020, again rebounding in the last few years. The country’s collapse was widely blamed on decades of mismanagement, lack of investment and U.S. sanctions.
Huge oil reserves
While oil production has been hampered, its reserves are vast, likely the largest in the world — larger than Saudi Arabia, Iran and Canada. However, estimates suggest it would take $180 billion over a decade to restore production in the region to its heyday of the 1990s.
Interested investors will contend with political instability, aging infrastructure and low oil prices, at least right now.
Low oil prices
Oil prices have been dropping for some time, hovering over $60 US for several months. The market could also drive prices further down with expectations that Venezuelan oil may enter the already flooded market.
On Tuesday, Trump announced Venezuela would hand over between 30 and 50 million barrels of oil that he said would be sold at market price. The Trump administration is “selectively” removing sanctions to enable the shipping and sale of Venezuelan oil to markets worldwide, according to an outline of the policies published Wednesday by the Energy Department.
Where it sells its oil
Most of Venezuela’s modest oil production goes to China, an ally of the Maduro regime and major investor in the region. Venezuela is currently paying down an estimated $10-billion debt to China, covered in part by oil exports. In an interview following the capture of Maduro, U.S. Secretary of State Marco Rubio said about the raid: “…we’re not going to allow the western hemisphere to be a base of operations for adversaries, competitors and rivals of the United States,” very likely referring to China.
How much goes to the U.S.
The U.S. does buy a sizable portion of Venezuela’s oil, about 23 per cent of it in 2023.
However, Venezuela has fallen as a source of oil for the U.S. Trade data from the U.S. shows not a drop of Venezuelan oil went to American shores in 2020 and 2021, however small amounts were shipped in 2023 and 2024.
