Presidents Chavez and Maduro nationalized billions in U.S. oil company assets. Trump’s takeover could help ConocoPhillips, ExxonMobil and Chevron get billions back.

In a 2 a.m. raid under a full moon, U.S. Army Delta Force operators captured Venezuela’s President Nicolas Maduro and his wife. President Trump in comments on Saturday declared that his team will now “run” Venezuela and that he expects to get “very strongly involved” in rebuilding its oil industry.

The best part, says Trump, is that it won’t cost the U.S. anything. “We’re going to be rebuilding and we’re not spending money, the oil companies are spending money,” said Trump. “We’re going to take back the oil that frankly we should have taken back a long time ago.”

Western oil companies have won, and lost, access to Venezuelan oil several times. Royal Dutch Shell discovered oil in Venezuela in 1922, and early American giants Standard Oil and Gulf Oil soon followed. That trio dominated Venezuela's oil industry until 1976 when President Carlos Andres Perez nationalized the industry, wiped out their holdings, and created Petroleos de Venezuela.

PDVSA in the 1990s allowed the likes of ExxonMobil, Chevron and ConocoPhillips back in to further develop the country’s vast heavy oil reserves (more than 300 billion recoverable barrels by some estimates). Then in 1999 Hugo Chavez was elected president. Back then, Venezuela was still pumping 3 million barrels per day, much of it exported to the U.S. for refining at plants owned by PDVSA subsidiary CITGO. Chavez didn’t like the fact that such a big chunk of the oil profits was going to U.S. companies, and he starved PDVSA of capital to fund social programs. Then, in 2007, he began nationalizing the U.S.-owned assets. Venezuela’s oil output bottomed out around 300,000 bpd in 2020 before recovering to 900,000 bpd. Its biggest customer is China.

Today the only American oil company still allowed to operate in Venezuela is Chevron, which produces about 220,000 bpd there. Reached on Saturday a Chevron spokesman couldn’t say whether any personnel were hurt or assets damaged in the attack but that people and operations were their top priority, adding, “We continue to operate in full compliance with all relevant laws and regulations.”

It’s early days in Trump’s Monroe Doctrine revival, but if he does intend to make Venezuela’s oil industry great again, Trump will need the technical and engineering assistance of American oil giants and then some to restore Venezuela’s oil industry, especially if he doesn’t want to rely on the Russians........

© Forbes