Trump’s Venezuela Oil Revival Plan Is a $100 Billion Gamble

Summary

Bloomberg Businessweek — “Trump’s Venezuela Oil Revival Plan Is a $100 Billion Gamble”

Date: January 6, 2026
Hosts: Carol Massar, Tim Stenovec
Guest: Dr. Francisco Monaldi, Fellow in Latin American Energy Policy & Director of the Latin American Energy Program, Rice University

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Episode Overview

This episode dives into the ambitious and contentious plan spearheaded by former President Donald Trump to revive Venezuela's beleaguered oil industry, pegged as a potential $100 billion gamble. The conversation centers around U.S. interests, global energy dynamics, Venezuela's oil potential, the roles of international corporations and foreign powers, and what it would actually take for this revival to succeed. Guest expert Dr. Francisco Monaldi offers a sober, nuanced perspective on the technical, political, and economic realities underpinning this effort.

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Key Discussion Points and Insights

1. Why Does the U.S. Care About Venezuelan Oil?

• Strategic Motivation: The U.S. is looking to bolster its energy security and long-term supply resilience, not just for the present but as a buffer against potential future scarcity.
  • Dr. Monaldi:

    "Without a doubt, having more production in the Western Hemisphere is something that contributes to the energy security of the United States and potentially of the world." (02:46)

• Not Just a 'Grab': It's partly about the U.S. and global future demand, which, according to Dr. Monaldi, likely won’t decline for at least a decade.

2. Global Oil Demand Outlook and Venezuela's Potential Role

• Demand Stays High: Recent analysis from international agencies predicts no decline in demand for the next ten years, and risks of scarcity could rise by the decade’s end.
  • Dr. Monaldi:

    "Basically, there is a high probability that we will not see in the next 10 years decline of oil demand… Venezuela could multiply by four or even five its production. At least that's technically possible; politically, is of course another question." (03:31)

• Unique Position: Venezuela and possibly Iran are among the very few countries capable of materially boosting production in the coming years.

3. The AI-Energy Angle & National Security

• AI and Energy Usage: Booming AI and tech growth is creating increased electricity needs, which ripple across the entire energy system.
  • Dr. Monaldi:

    "For the first time in a long time, we will see a significant increase in electricity demand in the United States, which will have effects over the whole energy system and does contribute to the need of more fossil fuels." (04:32)

4. Corporate Hurdles: Will Oil Giants Return?

• Major Legal and Investment Barriers:
  • U.S. oil giants like ConocoPhillips and ExxonMobil are owed billions due to past expropriations.
  • For companies to return, Venezuela must guarantee "clear regulatory, contractual, fiscal framework that is credible in the long run."
    • Dr. Monaldi:

      "They will need to have a clear regulatory, contractual, fiscal framework that is credible in the long run… before they can recover [their investments]." (05:29)

  • Exxon's caution: Given the relatively small debt and past experiences, Exxon may be even less likely to invest again.
• Recovery Before Investment: For some (like Conoco), returning may be the only pragmatic way to recover massive debts.

5. The Role and Hesitancy of China and Russia

• Current Foreign Players: Venezuela’s oil sector is now split mainly among the national oil company, Chevron, and then Chinese and Russian state companies, each with meaningful but complicated stakes.
  • Dr. Monaldi:

    "About half of the production is done by the national company, 25% by Chevron, and then the other two big players are the Chinese and the Russian national companies. Each produces about 10, 11% of Venezuela's oil." (06:45)

• Reluctant Partners: The Chinese are owed more than $10 billion and have faced tough conditions, making them very reluctant to pour in more capital; Russian expansion is inhibited mainly due to geopolitics.

6. The Bottom Line: Is the U.S. Plan a Good Idea?

• Outcome Is Uncertain: The impact completely depends on Venezuela’s political and legal trajectory.
  • Dr. Monaldi:

    "If this has a happy ending with… a transition to democracy, rule of law, etcetera, I think it would be something very positive for the region and for the future of the oil market. If it doesn't, of course it could go really, really wrong." (07:47)

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Notable Quotes & Memorable Moments

• On U.S. Motivations:

  "It's a combination of things... having more production in the Western Hemisphere is something that contributes to the energy security of the United States."
  — Dr. Francisco Monaldi (02:46)

• On Venezuela’s Unique Oil Potential:

  "Venezuela could multiply by four or even five its production. At least that's technically possible; politically, is of course another question."
  — Dr. Francisco Monaldi (03:31)

• On Foreign Corporate Concerns:

  "They will need to have a clear regulatory, contractual, fiscal framework that is credible in the long run."
  — Dr. Francisco Monaldi (05:29)

• On the Need for Rule of Law:

  "If this has a happy ending with... a transition to democracy, rule of law... it would be something very positive... If it doesn't, of course it could go really, really wrong."
  — Dr. Francisco Monaldi (07:47)

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Important Timestamps

• 02:46 — Dr. Monaldi explains U.S. motivations behind involvement in Venezuela
• 03:31 — Venezuela’s potential to increase oil production and the global supply outlook
• 04:32 — Discussion on AI-driven demand, energy security, and increased fossil fuel use
• 05:29 — Requirements for international oil companies to re-invest in Venezuela
• 06:45 — The current foreign players and their hesitancy to invest more
• 07:47 — Dr. Monaldi’s reflection on whether the plan is wise
• 08:19 — Closing remarks and appreciation for Dr. Monaldi’s expertise

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Summary Takeaway

The episode offers a nuanced exploration of the economic and geopolitical stakes surrounding the proposed revival of Venezuela's oil sector. Success hinges not just on technical or financial capital, but on untangling Venezuela’s deep governance and debt problems, as well as managing international interests and risks. The $100 billion gamble is as much about politics and partnership as it is about oil. The consensus: the opportunity is huge, but so are the odds against an easy win.

Transcript

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[Barry Ritholtz]

You're listening to Bloomberg Business Week with Carol Massar and Tim Stanvac on Bloomberg Radio.

[Bloomberg Reporter]

U.S. energy goals when it comes to Venezuela as we mentioned, realizing President Donald Trump's plan for a US Led revival of Venezuela's beleaguered oil industry could be a years long and challenging process costing Upwards Carolina of $100 billion.

[Bloomberg Host]

Yeah, we want to welcome in a scholar on the politics and economics of energy and resource policy in Latin America. Specifically, he is Francisco Manaldi Fellow in Latin American Energy Policy and Director of the Latin American Energy Program at the center for Energy Studies at Rice University's Baker Institute for Public Policy. He's really so much more. I highly recommend you Google him because when it comes to energy, economics, energy management, this is someone who has consulted governments around the world, including Venezuela, the us, Saudi Arabia and Bund of companies as well, including Chevron and ExxonMobil. Dr. Manali, great to have you here with Tim and myself. Is this about a US Oil and energy grab? First of all, in your view, does it make sense that the United States wants to make sure that those energy assets are up and running or do you See it as something else?

[Dr. Francisco Manaldi]

Well, I think it's a combination of things. It's one of the, the motivations. I mean, without a doubt having more production in the Western Hemisphere is something that contributes to the energy security of the United States and potentially of the world. And today we have a surplus of oil. So it's not about the short term as much as about the future in which the role that Venezuela could play could be really important to supply the still increasing oil demand in the world.

[Bloomberg Reporter]

What does that future look like? I mean, help us take this out 1, 5, 10 years from now is, is what is the demand curve look like and how does Venezuela fit into that?

[Dr. Francisco Manaldi]

Well, you know, if you look at the scenarios like the recent one by the International and Energy Agency or the Energy Formation Administration, basically there is a high probability that we will not see in the next 10 years decline of oil demand. And in those scenarios we actually face the potential to of oil scarcity by the end of this decade. And there are very few countries, perhaps Iran, other than Venezuela, that can increase significantly production in the next decade. Venezuela could multiply by four or even five its production. @ least that's technically possible politically. Is of course another.

[Bloomberg Host]

Question. Well, and I also do wonder, is some of this because of a. I, we constantly talk about the power grab, the energy drawdown, the energy demand versus supply because of all of the investments in AI. Is that part of it? And this is the national security play, if you will, by the United.

[Dr. Francisco Manaldi]

States. Well, the case of air is more about natural gas than it is about oil because oil is typically not used to produce electricity. But without that, the fact that the for the first time in a long time we will see a significant increase in electricity demand in the United States will have effects over the whole energy system and does contribute to the need of more fossil.

[Bloomberg Reporter]

Fuels. So I'm wondering about companies and making big investments in Venezuela moving forward. Our reporting at Bloomberg News says that ConocoPhillips is owed more than $8 billion by Venezuela. Exxon is still owed about $1 billion stemming from the nationalization of assets. International arbitrators have ruled. What, what do these companies need to see from Venezuelan leadership or from US Leadership to say I'm ready to go back in there and make significant tens of billions of dollar.

[Dr. Francisco Manaldi]

Investments? Yes, there are lots of preconditions for them to be willing to do that. In the case of Conoco, because of the size of what they're owed, it is likely that they will be interested in going back to the country because Otherwise it would be hard for them to recover that debt. But they will need, first of all, they don't at this point have even contracts. They don't have, you know, any particular fields that those fields were expropriated from them. And they will need to have a clear regulatory, contractual, fiscal framework that is credible in the long run. And it does make sense for them to, you know, sink billions of dollars in investment before they can recover. In the case of Exxon, it might be something they will be even more cautious because they are not owed that much money. And of course, they have a history of government reneging and difficulty operating in the country that they will not.

[Bloomberg Host]

Forget. How much of this also has to do with China, who has certainly been investing in South America for some time, and we know that and has a relationship with Venezuela as well. How much of it has to do with.

[Dr. Francisco Manaldi]

That? Well, you know, it's interesting that the remaining big players in Venezuela, about half of the production is done by the national company, 25% by Chevron, and then the other two big players are the Chinese and the Russian national companies. Each produces about 10, 11% of Venezuela's oil production. In the case of the Chinese, they have been very hesitant in the last decade or so to invest more because they have had a tough experience in Venezuela. They are still owed upwards of $10 billion. And in the case of the Russians, they have a lot of reserves in Venezuela under their contracts, but they have not developed them and of course, under the current circumstances, are very unlikely to develop it in the.

[Bloomberg Reporter]

Future. Francisco, I want to ask you. It's a charged question and it's not a simple one to answer. We have a couple of minutes left here. Was this a good idea by the United States and what you're seeing play out, was it a good idea for the oil industry, a good idea for national.

[Dr. Francisco Manaldi]

Security? Well, it depends a lot on, of course, on what happens from now moving forward. I mean, if this has a happy ending with, you know, a transition to democracy, rule of law, etcetera, I think it would be something very positive for the region and for the future of the, of the oil market. If it doesn't, of course, it could go really, really wrong. And of course, we will have to.

[Bloomberg Host]

See. All right, going to leave it there. I'm sure we'll be reaching out to you again. Dr. Francisco Menaldi, fellow in Latin American Energy Policy, Director of the Latin American Energy Program at the center for Energy Studies over at Rice University's Baker Institute for Public.

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