U.S. President Donald Trump on Friday called on oil executives to rush back into Venezuela as the White House looks to quickly secure $100 billion in investments to revive the country’s ability to fully tap into its expansive reserves of petroleum.
Since the U.S. military raid to capture former Venezuelan leader Nicolás Maduro on Saturday, Trump has quickly pivoted to portraying the move as a newfound economic opportunity for the U.S., seizing tankers carrying Venezuelan oil, and saying the U.S. is taking over the sales of 30 million to 50 million barrels of previously sanctioned Venezuelan oil and will be controlling sales worldwide indefinitely.
Trump used the meeting with oil industry executives to publicly assure them that they need not be skeptical of quickly investing in and, in some cases, returning to the South American country with a history of state asset seizures as well as ongoing U.S. sanctions and decades of political uncertainty.
“You have total safety,” Trump told the executives. “You’re dealing with us directly and not dealing with Venezuela at all. We don’t want you to deal with Venezuela.”
Trump added: “Our giant oil companies will be spending at least $100 billion of their money, not the government’s money. They don’t need government money. But they need government protection.”
The president said the security guarantee would come from working with Venezuelan leaders and their people, instead of deploying U.S. forces. He also said the companies would “bring over some security.”
Trump urges Big Oil to take the plunge
Trump played up the potential for major oil companies to strike big, while acknowledging that the oil executives were sharp people who were in the business of taking risk, a quiet nod to the reality that he’s asking for big investment in Venezuela at a moment when the country is teetering and economic collapse is not out of the question.
Trump welcomed the oil executives to the White House after U.S. forces earlier Friday seized their fifth tanker over the past month that has been linked to Venezuelan oil. The action reflected the determination of the U.S. to fully control the exporting, refining and production of Venezuelan petroleum.
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It’s all part of a broader push by Trump to keep gasoline prices low. At a time when many Americans are concerned about affordability, the incursion in Venezuela melds Trump’s assertive use of presidential powers with an optical spectacle meant to convince Americans that he can bring down energy prices.
The White House said it invited oil executives from 17 companies, including Chevron, which still operates in Venezuela, as well as ExxonMobil and ConocoPhillips, which both had oil projects in the country that were lost as part of a 2007 nationalization of private businesses under Maduro’s predecessor, Hugo Chávez.
Venezuela might need legal changes to attract oil investments
While some wildcatters and other companies expressed enthusiasm for going into Venezuela, others spoke with a degree of carefulness about the legal and political barriers that still exist.
“If we look at the commercial constructs and frameworks in place today in Venezuela, today it’s un-investable,” said Darren Woods, the ExxonMobil CEO. “And so significant changes have to be made to those commercial frameworks, the legal system, there has to be durable investment protections and there has to be change to the hydrocarbon laws in the country.”
Other companies invited included Halliburton, Valero, Marathon, Shell, Singapore-based Trafigura, Italy-based Eni and Spain-based Repsol as well as a vast swath of domestic and international companies with interests ranging from construction to the commodity markets.
Large U.S. oil companies have so far largely refrained from affirming investments in Venezuela as contracts and guarantees need to be in place. Trump has suggested that the U.S. would help to backstop any investments.
Venezuela’s oil production has slumped below one million barrels a day. At the heart of Trump’s challenge to turning that around is convincing oil companies that his administration has a stable relationship with Venezuela’s interim President Delcy Rodríguez, and can provide protections for companies entering the market.
Trump, however, is confident that Big Oil is ready to take the plunge, but allowed that it’s not without risk.
“You know, these are not babies,” Trump said of the oil industry executives. “These are people that drill oil in some pretty rough places. I can say a couple of those places make Venezuela look like a picnic.”
Trump suggests China and Russia also want Venezuelan oil
The president also offered a new rationale for ousting Maduro and demanding the U.S. maintain oversight of its Venezuelan oil industry, saying, “One thing I think everyone has to know is that if we didn’t do this, China or Russia would have done it.”
While Rodriguez has publicly denounced Trump and the ouster of Maduro, the U.S. president has said that to date Venezuela’s interim leader has been cooperating behind the scenes with his administration.
Tyson Slocum, director of the consumer advocacy group Public Citizen’s energy program, criticized the gathering and called the U.S. military’s removal of Maduro “violent imperialism.” Slocum added that Trump’s goal appears to be to “hand billionaires control over Venezuela’s oil.”
Trying to restore diplomatic ties
Meanwhile, the United States and Venezuelan governments said Friday they were exploring the possibility of restoring diplomatic relations between the two countries, and a delegation from the Trump administration arrived in the South American nation Friday.
The small team of U.S. diplomats and diplomatic security officials traveled to Venezuela to make a preliminary assessment about the potential reopening of the U.S. Embassy in Caracas, the State Department said in a statement.
Trump also announced Friday he’d meet next week, either Tuesday or Wednesday, with Maria Corina Machado, the leader of Venezuela’s opposition party, as well as with Colombian President Gustavo Petro in early February.
Trump has declined to back Machado, even as the U.S. and most observers determined her opposition movement defeated Maduro in Venezuela’s last election. Trump said following Maduro’s ouster that Machado “doesn’t have the support within, or the respect within, the country” to lead.
Associated Press writers Matthew Daly and Seung Min Kim contributed to this report.
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