Trump says Venezuela issue was linked to oil, raising questions for global energy markets

Developments in Venezuela have sparked an important question about their potential impact on the global oil market.

US President Donald Trump made it clear that this is about oil, a day after Venezuelan President Nicolas Maduro and his wife, Cilia Flores, were captured in a quick overnight raid in Caracas.

The events in Venezuela have raised an important question: What impact will they have on the global oil market?

Analysts have said that Venezuela barely extracts 1 percent of its oil reserves and that the US move will not have a major impact on the global oil market.

“We will have very large US oil companies going into Venezuela, spending billions of dollars, fixing the badly broken oil infrastructure, and starting to make money for the country,” Trump said at 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 very large doses because they cannot produce much because their infrastructure is very bad. So, we will sell oil to other countries in large quantities,” the US president said.

However, the motive of the raid was narco-terrorism, which raises the question of how oil came into the picture.

Venezuela has 18 percent of the world’s oil reserves—the largest—but so far it has only been able to extract 1 percent of the oil. This is because Venezuela has heavy oil reserves, while the Gulf countries have light oil reserves.

Heavy oil requires high-level refining facilities, which Venezuela did not have. In addition, the US had imposed sanctions on Venezuela and prevented it from exporting oil, which further limited oil production.

Trump says US oil companies are moving to Venezuela, so it is unclear whether the ban will be lifted.

Analysts said that due to a number of already existing reasons, from heavy oil to US sanctions and limited refining capacity, the Venezuelan disruption would have no impact on the global oil market.

After months of threats and pressure tactics, the United States bombed Venezuela on Saturday and ousted leftist leader Maduro. He was taken to New York to face trial.

The U.S. operation brought an end to Maduro’s 12-year rule, which had a $50 million U.S. bounty on his head.

Trump posted a photo on Truth Social of the Venezuelan leader handcuffed and blindfolded on a U.S. Navy ship in the Caribbean.

From there, he and his wife, Cilia Flores, were flown to New York to face drug and weapons charges. Trump said he watched the operation to capture Maduro “live, like I was watching a television show” at his Mar-a-Lago estate.

Venezuelan opposition leader and Nobel Peace Prize laureate Maria Corina Machado declared on social media that her country’s “time for independence has come.”

Machado, seen as a hero by many Venezuelans for her staunch resistance to Maduro, called for an opposition candidate to “immediately” assume the presidency in the 2024 election.

Trump dismissed any expectations that Machado would emerge as a leader himself, claiming that he had “no support or respect” in Venezuela.