Hugo Chavez to Donald Trump: Venezuela’s tumultuous oil history

Venezuela's colossal oil reserves, which surpass those of Saudi Arabia, Russia, and Iran, have failed to translate into sustained prosperity. The country's output stands at approximately 1 million barrels per day, despite boasting over 300 billion barrels of reserves. This imbalance is a direct consequence of political instability, poor management, and foreign interference.

After Nicolas Maduro was ousted and extradited to the US, Venezuela's oil industry once again captured global attention. The US, eager to capitalize on Venezuela's vast resources, struck a monumental deal with North American Blue Energy Partners, enabling the extraction of 65 billion barrels of oil - roughly 21% of the nation's reserves. The deal, brokered by US Special Forces and signed on August 31, 2023, is touted as the largest oil agreement in history.

However, it's worth noting that Venezuela's oil is predominantly heavy sour crude, which is more challenging and costly to refine into petroleum and diesel. This type of crude trades at a lower price than the US's preferred light sweet crude, and US refineries are better equipped to handle the latter.

The US views this deal as a strategic move to reshape Venezuela's political landscape, as part of President Trump's plan for regime change. The privatisation and investment in Venezuela's energy sector are intended to weaken the current regime, with the hope that US oil giants may resume operations, reviving the country's oil industry.