Experts Call US’ Attack on Venezuela Driven by Oil, Risks Market Fallout

Experts say that the attack is going to risk continued dependence on fossil fuels and increase oil prices 

The United States’ military operation in Venezuela and the kidnapping of President Nicolás Maduro and his wife Cilia Flores have received widespread criticism from energy and geopolitical experts. They fear that this intervention will risk market volatility and increased dependence on fossil fuels. 

Venezuelan President Maduro and his wife will be extradited to the US to face charges on drug trafficking, along with a range of other charges. The US President also stated that the US is now in control of Venezuela and will be for some time, according to CBS News.  

Trump also indicated that the US oil companies will take charge of Venezuela’s oil production, stating, “We’re going to rebuild the oil infrastructure, which will cost billions of dollars, it will be paid for by the oil companies directly.” 

Venezuela holds the world’s largest oil reserves, with more than 300 billion barrels of proven crude oil reserves, according to the Organisation of Petroleum Exporting Countries (OPEC). 

Before Trump imposed a blockade on sanctioned ships entering and leaving Venezuela, the country produced approximately 1 million barrels of oil daily, including refined products and petrochemicals.  This accounted for about 0.9% of the global oil supply. China was the primary buyer of Venezuelan oil while Cuba received smaller volumes. However these shipments effectively stopped following the US blockade.

Chances of Market Fallout Beyond Venezuela 

“With the US capturing Venezuelan President Nicolas Maduro and his wife, the oil and gas industry once again could be affected by geopolitical issues,” said Ana Maria Jaller-Makarewicz, Lead Energy Analyst, Europe at the Institute for Energy Economics and Financial Analysis (IEEFA). Last year, oil and gas prices continued to fluctuate due to geopolitical issues, and this year that trend could continue. If Guyana, Mexico, or Trinidad and Tobago production in the Caribbean/Gulf of Mexico were to be impacted by conflict, oil prices would likely rise.”

Many experts have criticised US’ action, stating that their action is driven by fossil fuel interests rather than democratic concerns. Julian Popov, former Bulgarian environment minister and Senior Fellow at Strategic Perspectives, said, “The effective takeover of Venezuela, which is specifically targeting the world’s largest proven oil reserves, is yet another warning sign of how politically explosive and toxic oil interests can be.” He argued that the reduced dependence on fossil fuels will lower the risks of conflict. 

About The Author

Editorial Team

A team of handpicked and dedicated writers committed to fact check each climate-related statement. Go to the roots and intent of each policy implemented, internationally and at home to help you understand climate better

See author's posts