economy
January 9, 2026
High costs, falling returns: what could go wrong for Trump’s Venezuela oil gamble?
US faces big challenges in trying to unlock ‘tremendous wealth’ from Venezuela’s long-neglected oil industry
TL;DR
- The U.S. aims to control Venezuela's oil sales indefinitely, seizing nearly $3 billion worth of crude.
- Revitalizing Venezuela's oil production requires an estimated $183 billion and could take until 2040.
- The state-run industry has fallen into disrepair due to decades of neglect and alleged corruption.
- U.S. oil companies are wary of investing due to political instability and shareholder pressure for strong returns.
- A growing global oil glut and the rise of renewable energy are driving down prices, making heavy crude less viable.
- Political instability in Venezuela, similar to Iraq and Libya, means increased production is not guaranteed.
- Smaller U.S. independent drillers with higher risk tolerance are seen as potential 'first movers'.
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