Donald Trump has signaled plans to visit Venezuela and tap into the country’s vast oil reserves, the largest in the world. His remarks came after Venezuela passed new legislation allowing greater private and foreign investment in its oil sector. From Trump’s perspective, this presents a major opportunity for U.S. energy companies and could help boost global oil supply.
However, the reality on the ground is far more complicated. Venezuela’s state oil company, PDVSA, has been severely weakened by years of underinvestment and mismanagement. Oil production has fallen sharply compared to a decade ago, and restoring infrastructure would require massive capital spending.
Although Venezuela officially claims around 300 billion barrels in reserves, its export levels remain modest compared to countries like Saudi Arabia. Some analysts also question how much of those reserves are truly economically recoverable, especially given that earlier revisions were made when oil prices were much higher than they are today.
The country’s crude is also heavier and more sulfur-rich than many competitors’, making it harder and more expensive to extract and refine. On top of technical challenges, Venezuela’s prolonged economic crisis has driven millions of people — including skilled oil engineers — out of the country, leaving the sector short of expertise.
Ultimately, even if U.S. firms have the technical capacity to rebuild Venezuela’s oil infrastructure, the key question is economic viability. With oil prices hovering around $65 per barrel, large-scale investment may only make sense if prices rise and political as well as economic stability improves.
