The U.S. has been increasing pressure on Venezuelan President Nicolas Maduro to step down, including building up a military presence in the Caribbean and targeting alleged drug-smuggling operations. Despite past criticism of OPEC, the Trump administration is unlikely to push a new government in Caracas to leave the cartel, as Washington seeks to maintain strong ties with Saudi Arabia and the UAE.
Venezuela, a founding member of OPEC since 1960, has seen oil production decline from a peak of 3.7 million barrels per day in 1970 to around 665,000 bpd in 2021, with slight recovery below 1 million bpd in 2024. Its proven crude oil reserves are the largest in the world at approximately 303 billion barrels, most located in the Orinoco Belt.
Why It Matters
Restoring a U.S.-aligned government in Venezuela could provide American refiners and oil producers access to its vast reserves. Removing Venezuela from OPEC could destabilize global oil markets and strain relations with key allies like Saudi Arabia and the UAE. Maintaining Venezuela within the cartel allows the U.S. to influence production and benefit from market stability, while potentially enabling production increases under a friendly government.
U.S. Government: Pressuring Maduro to step down while protecting strategic energy and geopolitical interests.
Venezuelan Government: Facing mounting pressure, with the potential for a transition affecting oil production.
OPEC: Interested in keeping Venezuela within the cartel to maintain cohesion and leverage over oil supply.
Global Energy Markets: Watching for shifts in Venezuela’s output and OPEC policies.
Current Status
Trump has nurtured closer ties with OPEC leaders, particularly Saudi Arabia and the UAE, and has prioritized energy market stability. While the U.S. continues a high-pressure campaign on Maduro, it appears focused on securing a friendly government that can safely increase oil production, without challenging Venezuela’s 65-year OPEC membership.
Recent Developments
- U.S. sanctions have limited Western oil companies’ operations in Venezuela; Chevron remains the only major U.S. firm active under a waiver.
- The removal of sanctions could allow U.S. and European companies to return, potentially boosting production by around 1 million bpd over 10 years.
- OPEC’s interest in Venezuela remains high due to the country’s production potential and the fractures already appearing in the cartel.
With information from Reuters.
