Leaving OPEC won’t give Venezuela its oil back

Venezuela's decision to leave OPEC does not equate to reclaiming control over its oil resources. Despite being one of the group's five founding members, Venezuela's current situation does not offer a significant advantage in the near term. The US, under President Trump, has taken control of the sale of Venezuelan oil and exerted considerable influence over production, exports, and access within the country.

This move aligns with the interests of US oil companies, who would prefer not to be bound by OPEC's production quotas. However, leaving OPEC would only remove a minor obstacle to increasing production, as Venezuela currently benefits from an exemption from production targets due to sanctions and conflict. By departing from OPEC, Caracas would lose a crucial platform to collaborate with other major oil-producing nations and forfeit a sense of solidarity that was essential in preventing outside powers from manipulating individual producers.

OPEC's cohesion has already been challenged by the UAE's exit, and Venezuela's departure could further undermine the organization's effectiveness. While some US officials see potential benefits in Venezuela's oil supply topping up the Strategic Petroleum Reserve, the heavy and high-sulfur Merey crude is not immediately viable for domestic refining.

Restoring Venezuela's oil industry to its previous standards would require substantial, sustained investment over several decades. Leaving OPEC would not yield immediate benefits for Venezuela, and the Trump administration has been less than transparent about the management of the country's oil revenue. Maintaining membership in OPEC, despite its drawbacks, allows Venezuela to retain political leverage, a factor that becomes increasingly important as control over its oil resources comes under the scrutiny of the world's most powerful country.