By Gisela Salim-Peyer & Nancy A. Youssef
Thursday, January 29, 2026
María-Elena Pombo has created “petroleum weavings,”
turning threads made from oil into elaborate yarnlike wall hangings. Oil, she
told us, has shaped her life. Her father, an oil engineer, met her mother after
he moved to Cabimas, an oil town. Because of Venezuela’s oil wealth, Pombo, now
37 years old, studied for free at an excellent public university in Caracas.
For decades, all Venezuelans enjoyed the perks of living
in a land where oil was a birthright. They could fill their cars for almost
nothing. Education and other public services were heavily subsidized as well.
Academics might argue over the wisdom of the state’s largesse. But people
expected, at the very least, affordable gas as a material benefit from the
nation’s abundance of oil.
President Trump’s military intervention in Venezuela this
month was, in part, a bid to seize the source of this wealth. Venezuela has the
largest oil reserves in the world. Trump made no secret of his desire to
exploit them in what many have criticized as an act of naked imperialism and
the theft of Venezuela’s economic patrimony: “We’re going to be using oil, and
we’re going to be taking oil,” Trump said in an interview after the January 3 attack that captured the
strongman President Nicolás Maduro and his wife.
Yet many Venezuelans in the country and abroad celebrated
the strike. María Corina Machado, the popular leader of the opposition, has
welcomed Trump’s actions. Last February, Machado was a guest on Donald Trump
Jr.’s podcast. When he asked why Americans should care about Venezuela, her
first response was: “Oil and gas.” Machado’s strategy could appear to have been
a devil’s bargain—tempting Trump with the prospect of petrodollars in exchange
for ousting Maduro, her nemesis. But her feelings reflected something broader,
too: Venezuelans who once viewed oil as a source of wealth and pride, a
limitless resource that had shaped their identity and set their country apart
from its poorer neighbors, have come to view it more as a curse.
Venezuelans in the past two decades have watched as the
regime squandered the wealth that oil had created, let the country’s oil
infrastructure rot, removed gasoline subsidies, and welcomed a bigger hand from
Cuba, bartering oil for professionals and intelligence operatives from Havana.
Pombo says her generation is the last that benefited from oil. Today, the
university where she studied is in such a sorry state that the roof of one of
its buildings collapsed. In the former boomtown of Cabimas, in
northwestern Venezuela, people grew so desperate that they jury-rigged
refineries in their own backyards because gasoline had become so scarce and
expensive.
By that measure, ceding the oil industry to the United
States at least holds the promise of importing industrial know-how with some
financial benefit for the country. A poll by The Economist found that a
majority of Venezuelans “somewhat” or “strongly” supported the capture of
Maduro and were optimistic about their economic prospects. Fewer than 35 percent thought that the Venezuelan government should
continue running Venezuela’s oil industry. Or as Sary Levy-Carciente, Machado’s
economic adviser, put it to us, the Americans will be “better clients.”
***
At a ranch in Cabimas one day in 1922, local farmers were
awoken by a bang followed by a black rain. Workers for Shell, an
Anglo-Dutch company, had been poking holes in the ground, looking for oil—and
struck it rich. A plume spouted for many days. Some viewed the discovery as a
divine gift, while a local priest chastised the explorers for unearthing Satan,
saying the blowout was God’s punishment. Word traveled northward, and the
Rockefellers of Standard Oil and the Mellons of Gulf Oil saw a business
opportunity. The episode ushered in more than a half century of relative prosperity.
Even then, some saw signs of trouble. In the 1930s,
Arturo Úslar Pietri, an influential intellectual and historian, argued in an
essay that the country needed to “sow the oil” by investing oil profits to
cultivate other industries. Generation after generation of schoolchildren have
heard these words repeated as advice that the country should have followed but
didn’t. Instead of sowing the oil, Venezuela became dependent on it.
American companies arrived to drill the wells and build
the fields. They brought with them country clubs and baseball. The companies
made deals with whichever military despot was in power in Caracas, angering
young intellectuals such as Rómulo Betancourt, who harbored dreams of a
democratic Venezuela. In his writings, he condemned “the aggressive, juvenile impetus of North
American capitalism” and advocated for Venezuelans to be the owners of their
oil.
Betancourt became president through a coup in 1945,
putting him in position to fulfill his goal of a democratic constitution. But
he exercised caution over oil. He didn’t kick out the Americans but instead
persuaded them to pay more. He then used those proceeds to build schools,
hospitals, and roads. Starting in 1948, American companies extracted the oil
and gave roughly half of the profits to the Venezuelan state, an arrangement
known as el fifty-fifty.
Betancourt’s stance that Venezuela resented America but
needed America is reflected in Miguel Otero Silva’s 1961 novel, Oficina No.
1. The story follows pious, rural Venezuelans who leave everything behind
to move to a nameless town where newly arrived Americans are extracting oil
with little foresight or planning. The Trinidadian driver who takes the
Venezuelans to the fields sings a song in English, as if warning about the type
of people the Americans are: “After Johnny eats my food, / After Johnny drinks
my rhum, / After Johnny wears my clothes, / Johnny comes back and takes my
wife.” But the Venezuelans pay him no mind. They moved to a town with no name
because that was their best hope.
Yet many Venezuelans idealize this period. The years of el
fifty-fifty were some of the most prosperous in Venezuelan history—a time
when migrants were eager to come to Venezuela, rather than leave it, as they
have in droves more recently. Hundreds of thousands from Europe and elsewhere
arrived for the glorious tropical climate, golden Caribbean beaches, and
plentiful job opportunities. The possibilities felt limitless. The country
built some of the world’s most futuristic highways and was early in eradicating malaria. When Christian Dior
decided to open his first shop in Latin America, he opened it in Caracas. The
Concorde, that majestic superfast airplane, flew in at least once a week. Oil
was the draw that brought the world to Venezuela. Even Venezuela’s shanties
were made with solid construction materials such as brick and concrete, made
cheap by a strong bolivar, Venezuela’s currency. It was not uncommon to see new
cars parked outside. And although the Venezuelan poor could not afford the
shopping trips that the country’s rich made to Miami, they could go to
Margarita—a Venezuelan island famous for its beaches and low tax rates.
By 1976, however, Venezuela’s political class had tired
of el fifty-fifty. The government seized the assets of American
companies and nationalized the oil industry, creating a state-owned giant
Petróleos de Venezuela, known as PDVSA.
For years, the company thrived. José Guerra, a Venezuelan
economist, told us that graduates aspired to land PDVSA jobs. (He didn’t make
the cut as a young man, and had to settle for a job at the central bank.) The
government funded scholarships so that the best and brightest could study
abroad and become PDVSA engineers and managers. For Luis Soler, who worked at
PDVSA for 30 years, the company represented a certain idea of meritocracy. It
had an American-style work environment complete with 9-to-5 workdays and a
corporate ladder for promotion. “We had discipline, values,” he said.
By the 1990s, PDVSA had become one of the largest and most influential state-owned oil companies in
the world, second only to Aramco, its Saudi counterpart. Venezuelan leaders
proved to themselves that they could competently manage the country’s oil.
Yet as Pietri had predicted more than a half century
before, the country had failed to spread the wealth sufficiently to bolster
other industries. “We just traded it! We traded it, and for what? Cars from the
United States, whiskey from Scotland, fabrics from Italy, perfumes from
France,” Rafael Quiroz, an oil economist at the Central University of Venezuela
in Caracas, told us. “And as time passed, we didn’t build anything. We didn’t
use the oil to make an economy.”
Those outside the circle of PDVSA profits grew resentful.
Seeds had been sown, but not for broad economic growth, as Pietri had once
hoped, but for revolution.
***
The socialist Hugo Chávez came to power in 1999 and
managed PDVSA for priorities other than maximum profits. He replaced thousands
of highly trained company employees with party loyalists. And for the first
decade of the 21st century, the state used oil as a tool of diplomacy, with
Chávez lavishing petrodollars on tiny island nations whose votes he courted in
the Organization of American States, a regional diplomatic forum. Venezuela
replaced Russia as Cuba’s main oil supplier, a favor that Cuban President Fidel
Castro returned by becoming Chávez’s mentor on authoritarianism. The
consequences of the mismanagement were profound. A country that fully depended
on oil became ill-equipped to produce it. After the oil boom, Venezuela somehow
ended up poorer, beset by corruption and hyperinflation.
When Chávez died, in 2013, Maduro inherited a failing oil
industry and did little to improve it. By 2020, Venezuela’s refineries had
crumbled to the point that the country had to start importing gasoline from
Iran. Even during the worst years of a humanitarian crisis, Maduro continued
supplying his friends in the Cuban government with oil. (In January, the U.S.
assault to capture Maduro killed 32 Cuban officers on the president’s security
detail.) Venezuela now produces only about 1 percent of the oil in the world, a mere 1 million barrels
a day.
The perception that Maduro gave away oil to keep himself
in power has made some Venezuelans more comfortable with the idea of giving oil
to America, the country that got rid of the strongman. “Venezuela is going from
having a government controlled by Cuba to having a government controlled by the
United States,” the historian Pedro Benítez told us, adding that the U.S. can
help with the huge investments needed to revive the oil industry.
The rise of Machado is its own testament to changing
attitudes about oil. Of all the opposition leaders, Machado has spoken most
consistently in favor of privatization and foreign investment. For a long time,
these preferences made her relatively unpopular. But in recent years, her views
have spread widely. Many Venezuelans would have liked to see Machado replace
Maduro as part of a transition back to democratic government. But so far, the
Trump administration has shown little interest in that, preferring instead to
work with Delcy Rodríguez, Maduro’s vice president, and the rest of the regime.
Like Betancourt, she portrays the United States as an unwelcome imperial power:
“Enough of Washington’s orders to Venezuelan politicians,” she said on Sunday. But when it comes to oil, she’s ready to
deal. In a speech before legislators this month, she said that she would
proceed with an “agenda of cooperation” nonetheless. “Let’s not be afraid of
contradictions,” she said.
***
American companies are poised to develop Venezuela’s oil
industry anew. Trump said this month that Venezuela would provide 30 million to
50 million barrels of oil to the U.S., and that the sale of this oil would
“benefit the people” of both nations. Rodríguez said that Venezuela had received
$300 million from the sale, the first payments from those barrels. She
celebrated the country’s much-needed share of the revenue.
Trump sees a fresh era of American investment from the
oil giants of today. He recently hosted the chief executives from the major
U.S. oil firms at the White House to pitch them on the prospect. But the
challenges are legion, including the need for political stability in both
Venezuela and the U.S. There are no guarantees that a new American
administration would take the same tack as Trump. And although working with the
regime has brought its country near-term calm—Venezuela is secured right now by
pro-government militias—the Trump administration has spoken about an eventual
political transition. This leaves Caracas in a governing limbo and U.S.
companies wary. Only a stable government can provide sufficient security for
the companies to commit to long-term investments.
Over time, the key power brokers in Venezuela may
splinter over their new fifty-fifty-style deal with the U.S. “The
current arrangement is unlikely to be convenient at the same time for all of
them. One of them or some of them will try to change it,” Jana Nelson, a top
Pentagon official on Western Hemisphere affairs during the Biden administration,
told us.
Even so, many in Venezuela seem guardedly optimistic.
Guerra, the former central-bank official, used to be critical of the opposition
for courting a U.S. intervention, but he’s now bullish about the economy. He
envisions the U.S. government placing conditions on how the regime can spend
future oil revenues to make sure the nation’s natural wealth is used to revive
Venezuela.
We pointed out that this scenario rests on the assumption
that Trump cares about the fate of Venezuela and its people. “Well, we cannot
assume anything else,” Guerra told us. The Venezuelan people, he added, are
“just onlookers, not actors. We are just looking at what’s happening, hoping
for the best. We don’t get to determine anything.”
No comments:
Post a Comment