The Trump administration's latest move on Venezuela may prove to be a costly gamble, with experts warning that the country's oil sector is in dire need of investment. President Donald Trump has expressed enthusiasm for securing an oil deal with the embattled South American nation, but his former national security adviser John Bolton is less optimistic about the prospects.
Bolton, who served under Trump from 2018 to 2019 and later became a vocal critic of the president, believes that Trump's focus on securing oil deals may backfire. In an interview with Newsweek, Bolton argued that American oil companies will be wary of investing in Venezuela due to its poor governance record.
"The state of a government is the sort of thing that colors any American company considering investment in Venezuela," Bolton said. "They're just not going to be eager to go in and deal with a regime that 20 years ago nationalized what was left of U.S. oil investments."
Venezuela's history of nationalizing foreign-owned oil assets has led to numerous disputes with international companies, including ExxonMobil and ConocoPhillips. In recent years, the country has faced significant financial challenges, including an ongoing economic crisis and a decline in oil production.
The Trump administration's proposed plan to revive Venezuela's oil sector involves investing billions of dollars to repair the country's aging infrastructure. However, many experts warn that this approach is fraught with risks, including security concerns and the potential for corruption.
"The new government will need to ensure law and order are reestablished and that it's safe for foreign engineers and managers to work in the country," said Claudio Galimberti, chief economist at Rystad Energy. "The divestments by many International Oil Companies (IOCs) from places like sub-Saharan Africa over the past decade shows that law and order are critical conditions to be met for IOCs to operate in a country."
While some analysts believe that Venezuela's oil reserves could provide significant economic benefits, others argue that the risks associated with investing in the country outweigh any potential rewards.
"Venezuela is home to the largest proven reserves in the world but tapping into these largely dormant bounty is going to be 'very difficult'," Galimberti said. "The infrastructure is in a horrific state after decades of mismanagement, underinvestment, and flight of know-how."
As the Trump administration presses ahead with its Venezuela plan, many are left wondering whether the president's gamble will ultimately pay off or prove to be a costly mistake.
Bolton, who served under Trump from 2018 to 2019 and later became a vocal critic of the president, believes that Trump's focus on securing oil deals may backfire. In an interview with Newsweek, Bolton argued that American oil companies will be wary of investing in Venezuela due to its poor governance record.
"The state of a government is the sort of thing that colors any American company considering investment in Venezuela," Bolton said. "They're just not going to be eager to go in and deal with a regime that 20 years ago nationalized what was left of U.S. oil investments."
Venezuela's history of nationalizing foreign-owned oil assets has led to numerous disputes with international companies, including ExxonMobil and ConocoPhillips. In recent years, the country has faced significant financial challenges, including an ongoing economic crisis and a decline in oil production.
The Trump administration's proposed plan to revive Venezuela's oil sector involves investing billions of dollars to repair the country's aging infrastructure. However, many experts warn that this approach is fraught with risks, including security concerns and the potential for corruption.
"The new government will need to ensure law and order are reestablished and that it's safe for foreign engineers and managers to work in the country," said Claudio Galimberti, chief economist at Rystad Energy. "The divestments by many International Oil Companies (IOCs) from places like sub-Saharan Africa over the past decade shows that law and order are critical conditions to be met for IOCs to operate in a country."
While some analysts believe that Venezuela's oil reserves could provide significant economic benefits, others argue that the risks associated with investing in the country outweigh any potential rewards.
"Venezuela is home to the largest proven reserves in the world but tapping into these largely dormant bounty is going to be 'very difficult'," Galimberti said. "The infrastructure is in a horrific state after decades of mismanagement, underinvestment, and flight of know-how."
As the Trump administration presses ahead with its Venezuela plan, many are left wondering whether the president's gamble will ultimately pay off or prove to be a costly mistake.
. All these experts warning about investment risks and corruption... meanwhile, Trump's just over here trying to make a deal 
. And Bolton, the ex-National Security Adviser, is like the Grinch, always raining on everyone's parade 
. I mean, come on, if it was that easy, he'd have made a killing investing in Venezuela himself 
. But seriously, folks, this gamble might just end up being a costly oil-astrophe 
!
The country's history shows that just investing more won't solve problems, you need to address the underlying issues. And have you seen the state of their infrastructure? It's ancient! 
. It's like they're playing a high-stakes game without knowing all the moves 
I mean, have you seen the state of their infrastructure? It's like they've been playing a never-ending game of Simon Says 
. I just don't think it's worth the risk, you know? 
. I mean, come on Donald, have you seen the state of the place? It's like something out of a bad sitcom - "The Price is Right"... but nobody's winning 
. The US oil companies are gonna be like "no thanks" to investing in Venezuela due to the shady governance record. I mean, what if they can't even get their own guys in there safely? That's just bad for business and potentially disastrous.
.