US President Donald Trump said that an amount of oil to be transferred from the transitional government of Venezuela to America will range from 30 to 50 million barrels, just days after US forces arrested Venezuelan President Nicolás Maduro in a shocking military move.
On January 6, in a social media update, Trump revealed that the oil would sent to America “immediately” where it would sold, based on markets, with funds in hand controlled by the US. That development follows internationally condemned US-led invasions of the country and clouded legality surrounding the regulation of Venezuelan oil exports, US Venezuela oil takeover.
Claims, which Trump has made about the
“Pleased to announce that the Interim Authorities of Venezuela are going to transfer between 30-50 million barrels of high-quality, ‘sanctioned’ oil to the United States of America,” Trump exclaimed in his tweet, adding that, “I have instructed the U.S. Secretary of Energy Chris Wright to commence this process.”
The oil would then moved through storage ships, then delivered to ports in the US, as stated by Trump. But Trump did not state a specific trade involved in Venezuela and also did not state a specific time frame for these deals to take place.
Taking into consideration the Brent crude price of around $60 per barrel at which the oil is currently trading, 50 million barrels of oil would be approximately $3 billion.
Background
Venezuela, a country rich in oil deposits, The rumor bases its origin on the military attack by US military forces on the 3rd of January, where the American Forces took over Maduro by night in Caracas. According to US media outlets, more than 75 civilians have died, including Cubans, from the attack. US Venezuela oil takeover, Trump started off by stating that America would “run” Venezuela and return the Venezuelan oil to American companies.
However, soon after, Marco Rubio escalated the matter to state that America would not govern Venezuela but would instead follow a “rule through sanctions and sea blockade on imports” on the country’s oil.
Can Venezuela produce so much oil?
Venezuela has the largest proven oil reserves in the world, yet it now produces fewer than one million barrels of oil per day. At the present rate of production, it will require more than two months to produce 50 million barrels of oil.
Analysts believe that while Venezuela may be able increase production slightly in the short term, a substantial increase would need investment in tens of billions of dollars, apart from years of effort. Even Chris Wright, in his statement on Wednesday, agreed that Venezuela’s historical production level would need “significant time and capital”.
“Interim government response remains cautious”
The Venezuelan government, now ruled by interim leader Delcy Rodríguez, has not addressed Trump’s claim about the Venezuelan oil supply. Rodríguez, once the vice-president of Maduro, appointed by the highest court in Venezuela. Rodríguez has been defending Maduro as the legitimate president of Venezuela.
In a statement following her appointment, Rodríguez stated, “Venezuela reiterates its commitment to peaceful coexistence, and we invite the US to join efforts within the framework of international law.” President Trump, however, made a public statement warning her, “If you don’t solve this problem, there’ll be a very big price to pay.”
“Legal” and political problems also arise
How precisely the US is to exercise control with respect to the sale of Venezuelan oil remains to be determined. Addressing an energy convention in Florida, just outside Miami, Wright stated: “The Trump administration is engaged in active dialogue with the Venezuelan government and US oil companies, which will be responsible for the sale of Venezuelan oil for an indefinite period of time, US Venezuela oil takeover.”
Trump also scheduled to meet the CEOs of the following companies: Chevron, Conoco Phillips, and Exxon Mobil at the White House. Of these, Chevron is the only major US firm currently operating in Venezuela.
In 1976, Caracas nationalized its oil industry; since then, several governments, including the one led by Hugo Chávez, have exerted control over it. Trump has said that Caracas “stole” US oil rights, as VP J.D. Vance also reiterated; no world court has ruled in favor of Washington.
Meanwhile, with the increasing pressures from the international community, the statement of Trump on oil complicates an unprecedented degree of involvement of the United States in Venezuela regarding questions on legality and sovereignty in the energy politics of Venezuela in the long run.
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