Why Does U.S. Control over Venezuelan Oil Matter?
HIIA Perspective – Written by Lillian Zsófia Aronson
In January, following an intervention that removed Nicolás Maduro from power, the United States effectively took control of the sale of Venezuelan oil “indefinitely.” The short-term effects on global energy markets will be muted due to Venezuela’s limited production capacity and Washington’s apparent reluctance to significantly reroute previous supply chains. It represents a major shift, however, from previous interventions in Iraq and Libya, where oil was overseen by international bodies, and could set a precedent for the future. It also raises questions about the future of the Organization of Petroleum Exporting Countries (OPEC), of which Caracas is a founding member. Since Venezuela holds the world’s largest proven oil reserves, the United States may have influence over more crude than OPEC, and this leverage could be used to shape markets and pressure rivals. While the move could be to the detriment of oil-producing U.S. allies, it is being balanced with the rollback of policies favoring renewable energy, which reinforces global demand for hydrocarbons. U.S. actions can be interpreted as part of broader moves under the Trump Corollary to the Monroe Doctrine, aimed at reclaiming the Western Hemisphere as undeniably part of the U.S. sphere of influence, and an attempt to reinforce the U.S. position in global great power competition in the emerging multipolar world order.
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