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‘To the victor the spoils’: Trump’s Venezuelan oil grab
The president has claimed the deal is the biggest in history, but Venezuelans fear the country is becoming ‘51st state in all but name’
It was “a predatory move” that reeked of old-school colonialism, said Le Monde (Paris). Last week, in a typically grandiose social media post, Donald Trump announced that the US and Venezuela had struck “THE BIGGEST OIL DEAL IN WORLD HISTORY”. It would, he claimed, give America majority control over 65 billion barrels of oil found at 17 sites in Venezuela’s Orinoco Belt and Lake Maracaibo.
Trump has been demanding this as a prize ever since US forces seized Venezuelan president Nicolás Maduro in a dawn raid on Caracas in early January, said Joseph Zeballos-Roig on MS Now (New York). “To the victor belong the spoils, right?” he told a rally in Nevada back in August, boasting how, with Caracas, he wanted to do things “the old-fashioned way”.
By strong-arming interim president Delcy Rodríguez, Maduro’s former deputy, into agreeing the deal, he has made Venezuela America’s “51st state in all but name”.
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Venezuelans are horrified, said Luis Manuel Aguana in La Patilla (Caracas). We are a “culturally patriotic and anti-imperialist” people who, like other Latin Americans, loathe “external oppression”. And Rodríguez’s flimsy promise that the deal will generate $209 billion in taxes over the next 25 years hardly makes this bitter pill any easier to swallow. But it is a deal that’s unlikely to hold, said Caracas Chronicles. It “looks, sounds and smells pretty unconstitutional”; any future government is more than likely to abrogate its terms.
Legally speaking, the accord is a “complete monstrosity”, agreed Rafael Quiroz Serrano in Tal Cual (Caracas). A leader with no electoral mandate, Rodríguez lacks the legitimacy to sign away our oil deposits; and under Venezuelan law the state oil company, PDVSA, must have a controlling stake in any oil production projects. Be that as it may, Caracas has been persuaded under the deal to appoint a private company – North American Blue Energy Partners (NABEP) – to control the 17 oil fields, on the understanding that the Pentagon is given a 35% stake in the business and receives 20% of all output at cost price.
And that’s a real cause for alarm, said Caracas Chronicles. NABEP’s Venezuelan owner, Alejandro Betancourt, is a byword for corruption. He made his fortune building power plants for Maduro’s predecessor Hugo Chávez, and “became synonymous with the vanishing of hundreds of millions of dollars” that Chávez had allocated to fixing Venezuela’s power grid. And he is now being investigated in Spain (where he lives) for alleged money laundering.
‘Wildly optimistic’
Betancourt would anyway have to work miracles for the deal to work out, said Catherine Bosley in Neue Zürcher Zeitung. Only 1% of global crude oil is currently produced in Venezuela, despite it having 17% of the world’s reserves. And given the dilapidated state of its oil infrastructure after decades of socialist misrule, that won’t change any time soon. Vast sums of investment are needed. True, Chevron, which already operates in Venezuela, promised to invest $7 billion over the next five years in a separate deal last week. But none of the other oil giants, some of whom lost billions when Chávez booted them out in 2007, are keen to engage.
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With good reason, said Keith Johnson in Foreign Policy. Trump’s numbers are “wildly optimistic”. Venezuela’s oil is very heavy and hard to process: only 20 billion barrels are likely to be recoverable from the 17 oil fields. And even that will take years to retrieve, a fact Trump conveniently overlooked when claiming the deal would drive down US energy prices that have spiked as a result of his war in Iran.
The deal’s economic prospects may be in doubt, said The Daily Beast (New York), but the political consequences are already being felt. By shoring up Rodríguez’s undemocratic regime, it has dashed any immediate hope of Venezuela turning to democracy. And it has given the green light to countries such as Russia to “attack and steal from weaker neighbours”.
