Well, at least Venezuela “worked.”
Donald Trump says he’s successfully concluded “the biggest oil deal in the history of the world” with Chavista revolutionary-turned-viceroy Delcy Rodríguez. He’s surely not exaggerating. Trump doesn’t do embellishment.
The arrangement — which was preceded by days of speculative press coverage in the financial media — hands the US a majority stake in a privately-owned venture that’ll control 65 billion barrels of Venezuela’s proven reserves. Rodríguez is allowing Trump to claim 55% of the JV’s output, which’ll be available to America at no premium to the cost of production.
“This historic transaction more than doubles American oil reserves, greatly increases our oil supply, and will substantially lower gas prices for all Americans, long into the future,” Trump declared.
There are innumerable caveats. US gas prices aren’t going to drop next week solely because of this deal, for example. Also, the cost of production in Venezuela’s very high. Orinoco crude’s basically sludge; we’re talking about refrigerated peanut butter here, not Malaysian Tapis.
Logistically, the saving grace is that many American refineries were purpose-built to turn a profit from heavy, sour barrels. So, if Trump’s new company — which, on paper anyway, will trail only Aramco in terms of proved reserves — can get the oil out of the ground and to the Gulf Coast, this would indeed be a historic boon to American energy “independence.” The scare quotes are there to acknowledge the perversity inherent in a nation securing its own sovereignty by denying it to another.
Needless to say, turning this venture’s grandiose vision into reality will require a helluva lot of money. But it’ll also require expertise, which means Trump will almost surely need Chevron and Exxon, who’ve so far been reluctant to go all-in on Venezuela fearing, among other things, a repeat of nationalizations past. Trump may be able to provide (or provide for) the necessary capital, but he’ll be hard pressed to convince jaded US supermajors that the political environment will remain stable enough for long enough to make this worth the trouble.
Consider that Delcy’s the furthest thing from a democratically-elected leader. She struck a Faustian bargain with Trump to run the country following the US special forces operation that captured Nicolas Maduro in January. In the eyes of some, that makes her something worse than a dictator. Here’s the daughter of a Marxist martyr selling Chavez’s revolution down the river. Figuratively at first. Now literally.
That’s just one more reason for locals to want this regime, all of it this time, gone. They might’ve despised Maduro, but I have to think national pride’s a factor. At least Maduro and Chavez were their dictators. Delcy’s a sellout and a puppet. Unless and until the local economy improves enough that everyday people are materially better off, her acquiescence to a neocolonial relationship with America is just insult to long-running injury.
Delcy said Saturday the deal with Trump will vastly improve her country’s economic lot, but let’s not kid ourselves: There’s going to be a skim here. And she’ll be in on it, along with her brother and the rest of the gang, including Diosdado Cabello who, in a testament to how truly unserious the Trump administration is about promoting democracy in Venezuela, remains not just among the living, but among the most powerful people in the country. He’s certainly the most feared man in Venezuela.
As Todd Robinson, a retired US diplomat who served as Chargé d’Affaires in Caracas, put it in remarks to ProPublica last month, “It’s just a horrible, horrible idea to leave [Cabello] in place.” “I don’t know what their aim is in doing that,” he added. “Unless it really is about oil, not democratic transition.”
Spoiler alert, Todd: It was always about oil, never about democracy. And some Venezuelans are doubtlessly concerned this weekend that the oil venture with Trump, whatever revenue it generates for Venezuela, means the White House (or this White House, anyway) will be loath to countenance a free and fair election that might result in Delcy’s ouster. In other words: The end game for Trump in Venezuela ironically may be the preservation of the Maduro regime, just sans Maduro.
Late Friday, Bloomberg said the Pentagon was working directly with Alejandro Betancourt, the original bolichico, on a joint venture for “a major stake in Venezuelan oil reserves.” The arrangement announced by Trump, and confirmed by Delcy, sounds a lot like that rumored deal.
If you’re unfamiliar, Betancourt was the subject of what it’s fair to call an unflattering 2021 Reuters special report which noted that opposition leaders in Venezuela considered him “a prime example” of “well-connected dealmakers” who made “billions” on government contracts, only to “move the money abroad, worsen[ing] the country’s economic woes.”
One of Betancourt’s companies was accused in a 2014 Florida lawsuit of paying bribes to high-ranking Venezuelan government officials as part of an overbilling scheme. According to contemporaneous reporting by The Miami Herald‘s Spanish-language sister publication, documents filed in conjunction with the case said “one or more former employees” had confirmed that those bribes “includ[ed] a $50 million payment to Cabello.” Similarly, Agencia EFE cited “a source close to the plaintiff” in reporting that Cabello was implicated in the payouts. Attorneys for the defendants called the allegations, which were never proven in court, “completely false.”
On Thursday, The Washington Post described a months-long effort on the part of senior US officials to resolve a foreign criminal case against Betancourt “in a way that would avoid criminal charges and end travel restrictions.” Betancourt — who was investigated, but never charged, in connection with what the Justice Department in 2018 alleged was a “billion-dollar international scheme to launder funds embezzled” from PDVSA — is now “a key intermediary between the US and Rodríguez,” WaPo said, noting that the Trump administration “began lobbying Swiss officials to resolve their case against Betancourt” in the weeks following the raid that captured Maduro.
Bloomberg’s Friday reporting said the Department of Defense worked directly with Betancourt in recent weeks and months on the parameters of a deal “focused on as many as 17 oil fields span[ning] Venezuela’s main petroleum basins.” The article euphemistically described Betancourt as “a controversial energy investor.” Just a day earlier, reports suggested Delcy may be drawing up plans to exit OPEC.
In his TruthSocial post announcing the oil joint venture, Trump said the deal will “set Venezuela on a course toward tremendous success and great prosperity.” He signed off as usual, thanking everyone for their “attention to this matter.” Trump might’ve included, “You’re welcome, Venezuela.”
Hugo Chavez must be spinning in his grave.
Why is this not being reported as theft of another countries resources? would not be astounded if it came out that the family Trump enterprises have a piece of this action, and when it does, the populace of the country , will shrug their collective shoulders adding another nail to the coffin of what was one of the the greatest, but shortest duration empires,in history.
Like everything else Trump says, his statement about his big oil deal is clearly an exaggeration. The biggest oil deal in history was the creation of OPEC by its collective member states (of which the main founder was Venezuela.) an in which the US had no part.
Well, the good news for the people of Venezuela is that the deal(s) open the door for US earthquake recovery help to finally start flowing in.
My only hope in all of this is that I eventually get to experience the schadenfreude when the folks in bed with the Trump regime get their comeuppance. I’d have a good laugh if Iran blew up the oil infrastructure in the middle east and this Venezuela deal kept oil prices in check.
Then again, I also wouldn’t care if oil stayed at $120 a barrel. Make it even more blindingly obvious to the Trump base how stupid their war against renewable energy is (not that they’d ever get it).
Unfortunately, there’s a nagging part of me that knows that any consequences for Trump’s actions would inflict far more pain on innocent parties than they would on the people who deserve to suffer the consequences.
For a hot second, I thought the portrait on the left was Sacha Baron Cohen from The Dictator. Once my conscious mind caught up, I realized it almost had to be Simon Bolivar, and I went on a quick image search to verify it.
It turns out the reality is almost as weird. Hugo Chavez was so obsessed with Bolivar that he had his corpse exhumed and then had a 3D portrait rendered using the software that anthropologists use to generate images of what neanderthals would have looked like.
NYT article on the portrait: https://www.nytimes.com/interactive/projects/cp/reporters-notebook/moving-to-venezuela/simon-bolivar-posters
I can always count on you to say something or make a joke I wish I would’ve thought of or made.
I struggle to think of a better compliment, thanks dude.
I like to imagine my witty comments cancel out the abrasive shit-stirring ones.
Not sure which category this one belongs in.
Poor Simón, “El Libertador” deserved to RIP. During his lifetime he fought more than 100 battles, survived at least 3 assassination attempts, two internal coups, and dozens of regional rebellions and mutinies. He eventually died young — aged just 47 — from tuberculosis.
I don’t know how any “deal” survives Trump’s presidency unless the U.S. is willing to commit to enforcing some sort of colonial arrangement in Venezuela.
From today’s NYT article: Details were sparse, however, and the text of the agreement was not immediately available.
Probably less written documentation than most of us would demand when buying a toaster. Expect lawsuits, at least.
“Details were sparse” is the defining characteristic of Trump deals.
Trump just keeps inching closer to that Nobel prize ? Maybe he can get one for economics if not peace ??
Well done Walt: A perfect example/precedent about what your President wants to do with Canada – pillage and plunder, then scoop some off the top – in broad daylight, while y’all stand and watch. Canada won’t. Come join us.
No can do. I looked into it, but bringing my legally-purchased gun collection with me would be impossible under your laws and I’m damn sure not getting rid of my guns. The world’s not getting any safer, after all.
I realize that’s a “cringey,” stereotypical American thing to say, but I imagine most long-time American handgun owners will agree (or at least understand where I’m coming from) when I say that going from being (legally) armed more or less everywhere, all the time, to being unarmed save a hunting rifle locked in a bedroom closet at home, is psychologically daunting to the point of being a total non-starter.
I’m sure you can appreciate the irony of being wedded to guns out of a concern for safety while being unwilling to move to a country where per capita gun deaths are a fraction of your current residence.
And yes, I also grew up around guns but discarded the gun rights dogma just as easily as I did religious dogma.
The world outside the US isn’t as scary as many people make it out to be. My wife and I have been travelling in a truck with slide in camper for over 4 years including; 5 months in Mexico, 6 weeks in Nicaragua, a month in El Salvador, 5 months in Colombia, 2 months in Ecuador, and various amounts of time in the other South American countries. The only country we avoided was Venezuela, although a number of our friends have driven through there. I was in the army for 6 years so I am comfortable with guns but as you can imagine carrying a 9mm in the glove box is frowned upon when crossing borders.
The world INSIDE the US isn’t as scary as many people make it out to be either.
People are their own worst enemy. In the U.S. suicide is twice as common as homicide and firearms are the leading method for both men and women (although hanging is a close second for women).
As a firearm anecdote I’ll say that as a long distance backpacker I’m often asked what kind of firearm I carry. When people hear its common practice (even for solo females) to hitch into trail towns for resupply they are aghast that no one carries. On the PCT I hiked for a while with a man in his late 20’s and from the deep South who said hiking the AT had saved his life. Previously, he had been focused on bushcraft and survival skills. During his AT hike he began to realize that not all older white guys were angry, cynical, and burying extra guns to keep the government from coming to take them (apparently a common practice).
As a long distance hiker (not a licensed concealed gun carrier), who recently clocked in 100+ miles hiking with my brother (licensed concealed gun carrier), my first request was that he leave his gun at home. I am not against guns, but it can be off putting in a social situation when I’m attempting to have a nice conversation with fellow hikers that I don’t know. My second request was that we didn’t camp. He really is a great brother.
I understand. The thing is living in Canada, with the exception of a few locales, you likely would not need to feel you are in harms way. We just don’t think that way.
I used to own a cache full of beautiful firearms, ammunition, reloading supplies, etc., etc. I gave them all up two-years ago after moving into a gated community. They were all “badass” and everything else you could possibly imagine, but I guess I have changed over time. I realized that I would rather die (hopefully an honorable death) rather than ever shoot another human being. (Famous last words I suppose.)
It all worked out so well when we did similar in Iran in 1953, why shouldn’t forcing a puppet government to give us the oil work again, damn the will of the people?
I’m with you Heisenberg, as someone who grew up in the rural south my views on guns, hunting, and fishing were formed long before I ever had a political opinion.
Yeah, you wouldn’t know it for all the literature and film snobbery, college degrees, couture wardrobe and generalized pretensions to aristocratic grandiosity, but I was born and raised in deep Appalachia. I’m all for banning assault rifles, but other than that, I’m wedded to my unfettered gun rights. And really, it’s not a matter of “rights,” or politics, it’s just, as you alluded to, a matter of what you’re accustomed to. I just can’t imagine wandering around every day unprotected.
Endlessly entertaining, fun and insightful. Most interesting person I have never met.
Touché, SeaTurtle. Walt, you’re starting to remind me of the erstwhile Most Interesting Man in the World, who lived on our televisions during breaks (in the US at least) for a decade or two. (I’m probably not the first to say so.) But you’re apparently not a fictional character, at least based on my near-decade-long virtual reckoning. I suppose you could always replace your online self with an AI if you wanted to…. but please kindly don’t if you haven’t already!
There’s nothing fictional about this “character.” This is all me, all day, all the time. I don’t think people really understood that until the Monthlies started in 2023 and then, later, Kitsch Register. I am indeed exactly who I say I am. For better or worse.
Bessent and Warsh can only hold off higher rates for so long. Gotta have significantly lower oil prices – sooner rather than later.
Unfortunately lower oil prices aren’t a concern to this administration. Higher oil prices are the whole point – hence all the cancellation of alt energy / “green” projects, and now fed funding of bike lanes (gotta buy more oil !) and I’m coming to believe a war in the ME would be known to raise oil prices. Higher prices reward the big oil companies and all Trump/Kushner buddies in the ME. T has stated he doesn’t think about American’s financial struggles, “not even a little bit”
I expect the US majors will time their investment to avoid spending much before they see the next governments of the US and Venezuela.