In the wake of Venezuela President Maduro’s arrest, Senate Democrats passed a useless resolution prohibiting President Trump from using the military to attack Venezuela for a second time. Some Democrats have suggested that Maduro’s arrest was not about stopping drugs; its purpose was to steal Venezuela’s oil. As usual, Alaska Senator Lisa Murkowski showed how clueless she is by voting for it. President Trump will ignore the resolution, but the one thing that this vote illustrates is that Democrats back in Washington, D.C. (and Lisa), are very clueless about what President Trump is trying to do.
Yes, Venezuela does have the largest oil reserves in the world, bigger even than Saudi Arabia’s. However, those reserves are not just sitting there in tanks, ready to pump onto tankers. Two significant problems with Venezuela’s oil industry will prevent any quick “theft” of this resource.
The first problem is that its oil industry has been severely damaged by 26 years of socialist rule.
When socialists took over Venezuela, starting with Hugo Chavez, they nationalized the oil industry, kicking out the international oil companies, including ExxonMobil, ConocoPhillips, and Chevron. When those companies left, they took their technical expertise with them. Venezuela attempted to operate the industry itself, but the dictator Hugo Chávez treated it like a cash cow. Instead of using some of the revenue to reinvest and maintain the infrastructure, the money was used to pay for social programs. This malinvestment accelerated under the administration of dictator Nicolas Maduro.
One tool that analysts use to measure the health of an oil industry is by monitoring the drilling rig count working there. Rigs are required to drill new wells and maintain old ones. That information is published monthly by a company called Baker Hughes, and it is published for all producing oil fields in the world. The information for Venezuela can be seen in Chart 2.
There is a direct correlation between oil production and the number of drilling rigs working. Once numbering in the thousands, today, only two drilling rigs are operating in the entire country. This has resulted in a decline in production from over 3.8 million bbls/day to about 900,000 today. While this is still a significant amount of oil production, it is nowhere near what it should be, and It’s declining. Considering that they have the largest oil reserves in the world below ground, just waiting to be exploited, it should be much higher. By comparison, Saudi Arabia, with slightly less proven oil reserves, produces about 10 million bbls/day.
That brings us to the second challenge Venezuela has. Most of the oil produced in Venezuela is considered heavy oil. This type of oil is difficult to produce. It does not flow to the surface easily, requiring the use of downhole pumps that have a short useful life and require regular replacement. Given the challenges of this type of oil production and 20+ years with little reinvestment, it is no wonder that Venezuela is not producing as much oil as it should be.
When the Democrats suggest that President Trump is going to steal Venezuela’s oil, that just isn’t physically possible. The production of oil in Venezuela is challenging and requires complex technical expertise. It is below ground and under the control of the Venezuelans. Without the willing assistance of the individuals currently working in the petroleum industry, that oil will remain stranded underground and cannot be “stolen.”
If the country’s new leadership were smart, they would recognize the opportunity that President Trump has just presented them with. They would choose to adopt a democratic government, stop sending drugs to the United States, and use the free market to bring additional investment and technical expertise to their country to get the oil fields working again at peak efficiency.
The only thing forcing the Venezuelan government to make these moves is the fear that Donald Trump might send the Delta Force after them in the middle of the night, as he did with the dictator Maduro. When politicians in this country try to tie President Trump’s hands in the negotiation now taking place, it is counterproductive for what is best for Venezuela.
Perhaps if Lisa Murkowski had read President Trump’s book, “The Art of the Deal,” she might understand how negotiations are conducted and wouldn’t have joined with the Democrats in the Senate to try and tie his hands in doing so. Trump doesn’t want to invade Venezuela; he wants to help it produce more oil so we can buy it instead of the Chinese, and that will be a good thing for everybody, both here and in Venezuela.
The views expressed here are those of Greg Sarber. Read more Sarber posts at his Seward’s Folly substack.
15 Comments
I supported and voted for America First. Not some neocon extra double Christmas. How many times are we going to have to tolerate this dog and pony show? Country 38 trillion in debt. 2 trillion deficit. Replacement rate 1.6. Percentage of 30 yo who are married and own a home catering under 10%. Decadent and perverse culture and institutions. But you got your Venezuela and other foreign adventures door prize. I fear it’s not 5 or 10 percent who stay at home next election- but let’s assume it is that on the right and among independents. That is enough to sink the midterms. Trump had the potential of a ruling coalition to hand to a successor and transform this country. Instead he has gone over to the MIGA types and the neocons and has lost a critical part of the coalition. I am filled with disgust with the short term thinking and the lack of an ability to see pattern recognition. This will end in tears as it has every single time.
What a foolish statement. Basically nothing you said is relevant. This article really brought out the trolls.
Every word I wrote rings true. You refeted nothing, because you have nothing to say. Who is the “troll”?
Debt, deficit, replacement rate, home ownership, perverse culture, etc… are all reasons to vote America first. Then you go off on Venezuela and MIGA which I only assume is “make Israel or Iran? great again”? The first part of your post is irrelevant to the rest of it where you start spouting nonsense.
Far from nonsense daddio. Do you even see the contradiction from America First (yes please) and your fox news neocon foreign adventures?
Okay, Greg, since you have such great insight into the mind of Donald Trump, please explain precisely what his plans are for Venezuela. No one on any point on the political spectrum seems to know for sure. Will we have boots on the ground to help the country rebuild their infrastructure. Will the poor quality of crude oil their be transported to the U.S. for refinement, then sold at a huge profit? And how much would you like to see Trump benefit from all this financially? And since you know the mind of Trump so well, tell me what he plans to do with Greenland. Or perhaps ….. your attitude is, “If Trump wants it, it’s fine with me.” That would make you a cultist. Own up to it.
Greg, I must sadly disagree. Josh Hawley and Rand Paul also voted according to their CONSTITUTIONAL CONSCIENCE. The erosion of the Constitution began long, long ago, with people that are generally regarded as “Great”: Hamilton and Washington, who signed the obviously unconstitutional Bank of the United States into law. Then Andrew Jackson, who threatened to invade SoCar over nullification, setting the stage for Old Abe a generation later. Socialism began with FDR, undeclared foreign wars began with that “great” president, Harry Truman. Since then, just about every president has contributed to these BAD HABITS, until we now have an inverted Constitution. Wars have a nasty habit of getting out of control, placing the entire nation into Harm’s Way. “We have no Government armed with Power capable of contending with human Passions unbridled by morality and Religion. Avarice, Ambition, Revenge or Gallantry, would break the strongest Cords of our Constitution as a Whale goes through a Net. Our Constitution was made only for a moral and religious people. It is wholly inadequate to the government of any other.” — John Adams. We have thrown away religion with both hands. We ought not to decry those who still possess a conscience. Fidelity to their oath of office will be held before them at their Judgement. I don’t think Lisa has a properly formed conscience, but even a blind pig can find an occasional acorn. But Rand Paul and Josh Hawley hold my confidence, as would Ron Paul and Chuck Baldwin, the anti-Trump evangelical preacher.
Sorry Bob, I must disagree. First, US socialism crept in first with Woodrow Wilson, not FDR (though he ballooned it and bankrupted our nation). I do agree that many presidents have veered away from the Constitution and were not held in check by the other branches as they ought to have been. I don’t agree that we threw away religion, we just replaced it with the religion of atheistic secular humanism which is the root of all of these other problems. I think your reference to Lisa being a blind pig is accurate, but the libertarians and total isolationists do not hold the answers. Some things need to be handled with the big stick. To deny that is to deny human nature, which is also the nature of nations. The issue is how much and in what way to use of the stick.
Well, you are right about Wilson, but his beachhead into socialism would not be recognized by most. Oh, and Hoover did it, too. And the Freedman’s Bureau was the first federal welfare program before any of that, during Reconstruction. So, I commend your knowledge of history, but I must write for most folks who would not care about these factoids and brief incursions. But “isolationism” is a demonized word. Switzerland is isolationist, and they are highly respected and prosperous. Isolationism is NOT attempting to become economically self-sufficient, it is “avoiding entangling alliances”. What’s wrong with that?
Sorry but there’s a falsehood in your very first sentence. Dems are in the minority and don’t have the ability to have “passed a useless resolution.” There was something in the resolution that was compelling enough to cause 5 Republicans to vote for it too, which is unusual. As for your main assertion that the operation wasn’t about the oil, you must have missed Trump’s statement on Truth Social that he will keep pressuring Venezuela militarily “Until such time as they return to the United States of America all of the Oil, Land, and other Assets that they previously stole from us.”
Hi Jason, glad to have you as a reader.
American boys are being sent off to die for Israel. What happened to America first?
As for the book Art of the Deal, do you mean the one written by Tony Schwartz with exactly zero input from Trump? Face it, we MAGAs got BURNED.
i guess, but it sounds kind of ignorant since the author knows nothing about the nation’s history, i.e., they still got chavismo and they still hate bogus yankee land thieves. peace.
Murkowski needs to go.
The only thing Lisa governs by is Trump Hate. She has so much animus towards President Trump you’d think she was a deep stater. She has long since lost her support of the majority of Conservative, and Republican is this state. He support base is south of Canada, the free stuff natives, and the wacko Democrats.