Twenty years ago, the U.S. strained to defend against accusations that the Iraq War was about oil. Today, President Donald Trump openly admits the U.S. is willing to carry out regime change in Venezuela to secure privileged access to the country’s oil reserves.
Trump announced on Saturday that U.S. forces had captured Venezuelan President Nicolás Maduro in a brief military campaign to stand trial on drug-trafficking charges — an extraordinary moment in American foreign policy, both for the intervention itself and for Trump’s framing of what comes next. The U.S., he said, will “run the country” until it can lock in a transition of power, and announced that “very large United States oil companies” will go in, “fix the badly broken infrastructure … and start making money for the country.” Secretary of State Marco Rubio said Sunday this actually meant “running policy,” a statement that did little to clarify the administration’s next steps.
Indeed, what Trump is laying out as a straightforward mission is anything but that. The president is describing a situation that doesn’t match reality on the ground, starting with the leftover Chavista regime vowing it “will not be anyone’s colony.”
He understated the time-consuming, costly effort it would take to rebuild Venezuela’s decrepit oil sector.
Already, Trump is making fresh threats that underscore the uncertainty of what’s next.
Already, Trump is making fresh threats that underscore the uncertainty of what’s next. On Sunday in an Atlantic interview, he warned new Venezuelan leader Delcy Rodríguez that she is “going to pay a big price” unless she takes the country in a direction friendlier to U.S. interests. That night, she extended an olive branch, calling for a “cooperation agenda” between the U.S. and Venezuela built on mutual respect. The statement was stripped of the defiant, anti-hegemonic rhetoric that usually spills out of Caracas — for now. Even then, Venezuelan Defense Minister Vladimir Padrino López didn’t hesitate in calling Maduro’s seizure “a cowardly kidnapping” and renewed the military’s vow to confront “imperial aggression” on Sunday.
Oil companies, like any business, prize stability and time in executing regular business functions to profit. In Venezuela, both are going to be in very short supply in the near future. Already, Politico reported that U.S. oil executives are wary of Trump’s invitation to help restart production since it’s unclear who is running the country at the moment and questioning whether adding supply makes sense when trading prices are already slumping to $60 per barrel.
The American Petroleum Institute offered only a cautious statement Saturday that it was “closely watching developments involving Venezuela, including the potential implications for global energy markets.”
Iraq offers a cautionary example of post-regime change chaos. Following Saddam Hussein’s overthrow in 2003, engineers from Chevron and ExxonMobil did not immediately fan out and start drilling across the country. No Iraqi oil boom followed the fall of Baghdad. Instead, major oil companies held off on major commercial ventures while a full-blown insurgency ravaged Iraq.
In 2004, President George W. Bush promised that Iraqi oil “will benefit the Iraqi people” as scrutiny mounted over the cost of occupying Iraq. But in the years that followed, the Iraqi government struggled to restore oil production to pre-war levels.
In 2008, ExxonMobil, Shell and Chevron were among a handful of Western companies negotiating no-bid petroleum contracts to service Iraq’s lucrative oil fields and regain their foothold. But the new Iraqi government abruptly canceled the prospective deals, citing the crawling pace of negotiations with the oil giants. “Big Oil” companies didn’t return to Iraq’s oil fields until November 2009 — six years after the U.S. invasion.
Venezuela has more oil than Iraq ever did. It sits on the world’s largest reserves — 303 billion barrels, or 17% of the global total. But tapping it means confronting underinvestment, corruption, and the devastating effect of U.S. sanctions on state-owned oil company Petróleos de Venezuela (PDVSA), which scared away many would-be buyers of Venezuelan crude. “Much of Venezuela’s crude oil production capacity and infrastructure have suffered from a decade-long lack of capital and regular maintenance,” the U.S. Energy Information Administration said in early 2024. Equipment theft also plagues the aging oil sites. Once an efficient, reliable source of wealth for Venezuela, PDVSA has been hollowed out by epic mismanagement and mass firings that eliminated technical expertise. These days, Venezuela is a bit player in global oil markets. It produces around 900,000 barrels per day, or just 1% of global output. By comparison, the U.S. — now the top oil producer — produces around 13.9 million barrels per day. Chevron, the last major U.S. company still operating in Venezuela, pumps one-quarter of that while navigating debt and contract disputes and the jailing of several Chevron employees in recent years. One estimate from Rystad Energy, a consultancy, said it would take $110 billion in fresh capital spending to restore Venezuelan oil production to where it stood 15 years ago. The deeper context matters. Many Venezuelans draw national pride from oil. For three decades starting in 1950, Venezuela was far richer than most Latin American countries. It harnessed oil wealth to fund social programs in healthcare, education and food access. Peruvian author Mario Vargas Llosa wrote of Venezuela as a place “where the streets are paved with gold” in one of his lesser-known novels. When oil prices dropped in the 1980s, that prosperity came crashing down. It was bound to happen again once Hugo Chávez tied the success of his socialist revolution to sky-high oil prices in the 2000s. That’s the wreckage Trump proposes to clean up. Iraq taught us that regime change can create chaos that persists for years, complicating even the most lucrative economic opportunities. Venezuela’s oil wealth is undeniable, but so are the immense obstacles to accessing it. Declaring victory is the easy part. The United States has toppled Maduro, who continued policies that brought financial ruin on Venezuela while muzzling any opposition to his decade-long rule. Yet the hard work — and the reckoning with this modern chapter of “gunboat diplomacy” in Latin America — has only just begun.
Joseph Zeballos-Roig
Joseph Zeballos-Roig is a reporter who has covered economic policy and politics for Semafor, Business Insider and Quartz, among other publications. 
