US President Donald Trump has vowed that American oil companies will rush to exploit Venezuela's vast oil reserves, but industry leaders and economists are skeptical. The US has already seized several Venezuelan oil tankers, sparking fears among investors.
Despite the turmoil in Venezuela, where the government is mired in a constitutional crisis, Trump believes his administration can quickly extract billions of barrels of crude from the country. However, experts say that this plan is "doomed from the start" and that no major oil producer would risk investing in such volatile territory with global prices already at $55-60 per barrel.
"The real reason for any oil company to go in there is not the structure of the firm or their strategic positioning," says Yale economist Jeffrey Sonnenfeld. "It has to do with the character weakness of whoever the CEO is that gets browbeaten [by the Trump administration] into doing this, and that should be contested by shareholder activists."
The Venezuelan oil industry has suffered significantly in recent years due to corruption, mismanagement, and lack of investment. The national oil company, Petróleos de Venezuela (PDVSA), is effectively bankrupt and lacks the capacity to lead a recovery.
Given these challenges, it's unclear why Trump is pushing for an oil rush in Venezuela. While some might argue that this move diverts attention from domestic issues, many experts believe that it's actually a cynical ploy to shift the focus away from his own administration's vulnerabilities.
Sonnenfeld notes that pushing such a plan would be akin to "pounding their hand with a sledgehammer," implying that no amount of political pressure can overcome the economic reality. The law of economics cannot be changed by Trump's words and actions alone, Sonnenfeld argues.
In summary, while Trump is confident that his administration can extract oil from Venezuela, industry leaders and economists are highly skeptical about this plan being feasible or worthwhile.
Despite the turmoil in Venezuela, where the government is mired in a constitutional crisis, Trump believes his administration can quickly extract billions of barrels of crude from the country. However, experts say that this plan is "doomed from the start" and that no major oil producer would risk investing in such volatile territory with global prices already at $55-60 per barrel.
"The real reason for any oil company to go in there is not the structure of the firm or their strategic positioning," says Yale economist Jeffrey Sonnenfeld. "It has to do with the character weakness of whoever the CEO is that gets browbeaten [by the Trump administration] into doing this, and that should be contested by shareholder activists."
The Venezuelan oil industry has suffered significantly in recent years due to corruption, mismanagement, and lack of investment. The national oil company, Petróleos de Venezuela (PDVSA), is effectively bankrupt and lacks the capacity to lead a recovery.
Given these challenges, it's unclear why Trump is pushing for an oil rush in Venezuela. While some might argue that this move diverts attention from domestic issues, many experts believe that it's actually a cynical ploy to shift the focus away from his own administration's vulnerabilities.
Sonnenfeld notes that pushing such a plan would be akin to "pounding their hand with a sledgehammer," implying that no amount of political pressure can overcome the economic reality. The law of economics cannot be changed by Trump's words and actions alone, Sonnenfeld argues.
In summary, while Trump is confident that his administration can extract oil from Venezuela, industry leaders and economists are highly skeptical about this plan being feasible or worthwhile.
& it's not gonna work oil prices are already crazy high $55-60 per barrel, no one needs more risk in the market 
even with all the talk of venezuela's vast reserves, there's still corruption & mismanagement that needs to be addressed before any serious investment can happen 
. Like seriously who tries to pull off an oil rush in the midst of all that corruption and chaos? 
The industry pros are clearly skeptical for a reason, I mean $55-60 per barrel is already crazy so you'd think they'd want to play it safe, right? 
And what's with this "pounding their hand with a sledgehammer" thing, like Trump really thinks he can just will some oil magic into existence? 
.
. This whole thing just reeks of cynical politics to me 
. I mean, who wants to risk investing in a country with such corruption and mismanagement? It just seems like a recipe for disaster 
. Plus, I think Trump is trying to distract from his own problems rather than actually solving them 
. Not to mention the economic reality of it all... it's like he thinks he can just slap a magic wand on the law of economics 
. I don't get why anyone would trust him on this one 
.
. The US government is basically saying "hey, we'll take care of Venezuela's problems, you just sit back and relax" 
. Venezuela's economy is a mess, and now Trump wants to just go in there with guns blazing and expect everything to magically work out? 
It sounds like a recipe for disaster to me.
Like, I'd love to see some credible sources that back up this claim. Until then, I'm not buying it.
The idea of rushing into Venezuela's oil reserves without even thinking about the economic implications is just insane 
️ It's all about investor safety and Trump's admin is just talking trash I guess 
. The experts are saying he's got a bad case of economic whack-a-mole - no matter how many times he pounds the hand with that sledgehammer, the law of economics won't change 
.
And oil prices are pretty stable right now $55-60 per barrel 
Not exactly the most lucrative environment for extracting oil. Plus, have you seen the state of PDVSA? It's like they're running on fumes 
️
I just don't think this is going to end well 
. Industry experts just don't buy into his plan and I think they're right 
.
The economy is already in shambles there, what's the point of pumping billions of dollars into it? It's like trying to put a Band-Aid on a bullet wound 
. And what about the investors who are worried about losing their money? Shouldn't Trump be more concerned with fixing America's own problems rather than chasing after someone else's oil reserves? 