- US special forces captured Venezuelan President Maduro and his wife in a raid
- Venezuela holds 18 percent of the world’s oil reserves but extracts only 1 percent
- US oil companies plan to invest in Venezuela’s oil infrastructure, says Donald Trump
It's about oil, US President Donald Trump said quite frankly a day after US special forces captured Venezuelan President Nicolas Maduro and wife Cilia Flores from Caracas in a swift nighttime raid.
The events in Venezuela have raised one pertinent question: what would be its effect on the global oil market?
Analysts have said Venezuela extracts only 1 per cent of its oil deposit with much difficulty, and the US action won't have any major impact on the global oil market.
"We are going to have very large US oil companies going to Venezuela, spending billions of dollars, fixing the badly broken oil infrastructure and start making money for the country," Trump said in a press briefing.
"But in terms of other countries that want oil, we are in the oil business. We are going to sell it to them. We are going to sell it to them in much larger doses because they couldn't produce very much because their infrastructure was so bad. So, we will be selling large amounts of oil to other countries," the American president said.
The stated purpose of the raid, however, was narco-terrorism, which brings the question of how did oil come into the picture?
Venezuela has 18 per cent of the world's oil reserves - the largest - but could so far extract only 1 per cent. This is because Venezuela has heavy oil deposits, as against light oil found in Gulf nations.
Heavy oil needs higher level refining facilities, which Venezuela didn't have. In addition to this, the US had imposed an embargo on Venezuela and stopped it from exporting oil, which further restricted oil production.
It is not known whether this embargo would be removed, as Trump says US oil companies are going to Venezuela. Due to these already existing multitude of reasons, from heavy oil to the US embargo to limited refining ability, the Venezuela disruption will have no effect on the global oil market, analysts said.
After months of threats and pressure tactics, the United States on Saturday bombed Venezuela and toppled the left-wing leader Maduro. He was taken to face trial in New York.
The US operation brought the curtain down on 12 years of Maduro's rule, who had a $50 million US bounty on his head. Trump posted a picture on Truth Social of the Venezuelan leader handcuffed and blindfolded aboard a US naval ship in the Caribbean.
From there he and his wife Cilia Flores were flown to New York to face drugs and weapons charges. Trump said he followed the operation to capture Maduro live at his Mar-a-Lago estate "like I was watching a television show."
Venezuela's opposition leader, Nobel peace laureate Maria Corina Machado, took to social media to proclaim her country's "hour of freedom has arrived." Machado, seen as a hero by many Venezuelans for her dogged resistance to Maduro, called for the opposition's candidate in the 2024 election to "immediately" assume the presidency.
Trump brushed aside any expectations Machado herself would emerge as leader, claiming she did not have "support or respect" in Venezuela.
