The U.S. doesn’t need Venezuela’s oil. But other countries do.
I always laugh when people blame American military action, such as in the Middle East or elsewhere, on our thirst for oil. To believe this, you have to have an astonishing lack of understanding about economics in general, and oil markets in particular.
Here’s some quick remedial instruction, for any who need it.
First, oil is FUNGIBLE. That means a barrel of oil is equal to any other barrel of oil. And that means it doesn’t matter where you get it. All that matters is the price.
Second, oil is traded on a world market (as are things like diamonds, gold, and porkbellies.) Discounting for the cost of shipping, which is small relative to value, the price is the same everywhere.
Third, the United States has plenty of oil. We can be a net oil exporter anytime we want, and were during Trump 1.0. We can produce far more than we consume. And we have no shortage of reserves.
Fourth, at least half the country believes it’s better if oil is more expensive anyway, as it will incline us to use less of it. This is how we get discussion of carbon taxes and such: those are all to RAISE not lower the price of oil.
Fifth, what determines the price of oil on the world market is net demand vs. net supply. Other factors equal, if the supply goes up, the price goes down. Other factors equal, if demand goes up, price goes up. And vice versa in both cases.
Given all this, why, exactly, would the United States invade another country to “get its oil?” Wars are insanely expensive. Even if, in the first Gulf War against Sadaam Hussein, we’d done it to “get oil” as so many claimed, the economic arithmetic doesn’t work. Even if you invaded Kuwait, for example, and nationalized (stole) all its oil, you’ll lose money. If America owned Kuwait, we’d still have to spend money to get that oil out of the ground. That’s expensive. Then we’d have to sell the oil…on the world market. The profits on the nationalized oil (after expenses) would be unlikely to come anywhere near the costs of the war itself, not to mention the ongoing increased military spending needed to protect it. Not to mention the American lives lost, if anyone cares about that.
And again, why would this be in the U.S. interests? The American government is not in the oil business, nor do we want to be. If we wanted to “seize oil” we could seize our own oil, away from folks like Exxon/Mobile and Chevron. That’s what Chavez and Maduro did in Venezuela, tried to nationalize their own oil industry. They lost their shirts, and succeeded in making Venezuela—previously the richest country in South America—the poorest country in South America.
So when people say we invaded Venezuela to “get its oil,” they’re nuts.
Or are they?
It’s not always about strict economics. Why did the Japanese attack Pearl Harbor? Most Americans were never taught this (those dreadful NEA-controlled schools again), but the Japanese really did have a beef with America. Japan at the time imported something like 90% of its oil. America—in an attempt to stop Japanese imperial expansion—took steps to embargo that oil, and keep Japan from accessing it. Without the ability to buy oil, Japan was in serious trouble. Hence: the attack on Pearl Harbor. That was 100% about oil.
Jump ahead to the 21st century. Rightly or wrongly, America has tried in multiple ways to control the flow of oil so as to disadvantage our adversaries. It mainly does this by trying to keep oil-rich “bad regimes” from being able to sell their oil. And equally it tries to cut off oil-poor “bad regimes” from being able to access oil.
I’ve never been much impressed with this strategy because oil is, well, slippery stuff. And remember it’s fungible. All it takes is one “leak” in a sanctions regime, and oil will get to where people—even bad people—want it. Maybe you’ll marginally increase their cost. Big deal.
Unless you can truly squeeze off a nation’s imports or exports of oil (as we did with Japan), anything short of that won’t work. Oil will get through. Let’s use the analogy of, well, a barrel of oil. One small leak at the bottom of that barrel and the oil will be gone. One small leak in a sanctions regime, and the sanctions won’t work. Oil will get through.
That said, if you can make it work—as we did with Japan—well, you’ll have some leverage.
So consider all this as we look at the international oil markets in early 2026, with respect to the “bad regimes” that we’re trying to hurt.
Russia, Venezuela, and Iran are bad regimes who are oil exporters. They need their oil to get to market. China and Cuba, perhaps some others, are bad regimes who are oil importers. They need other people’s oil.
America has had sanctions on Iranian oil exports since forever. Trump 1.0 enforced them, and brought Iran to its knees. Biden ignored them, and thereby enriched the Iranian regime by an estimated 100 billion dollars. Much of that money went to fund terrorism in the Middle East, in particular to Hamas to bankroll the October 7th attacks. Trump 2.0 enforced the sanctions, and Iran is now back “on its knees,” deprived of vast oil wealth. Elections do indeed have consequences. (The Mullahs were really hoping Kamala would win, so they’d be rich again.)
Trump has also been running around the world trying to get people (looking at you, India) to stop buying Russian oil. Very difficult, as all it takes is one “leak” and Russian oil will escape on to the world market. But Trump’s been trying.
That brings us to Venezuela. Recently, Trump’s been seizing or sanctioning Venezuelan oil tankers, which is a pretty effective way of stopping oil exports from that country. Where were those oil tankers going? Many of them to China, and enough to Cuba to keep that evil regime afloat.
All this is background. We didn’t invade Venezuela because we wanted to selfishly grab its oil. We don’t need its oil. Even if we had it, all it would do is slightly lower the price of oil on the world market. It would have no material effect on either the U.S. population, or the American government. Some oil companies might make a few bucks, but we’d not conquer Venezuela to help Exxon. That’s nonsense. It’s like saying we’d invade Germany to seize their automobile manufacturing plants, so as to help General Motors. Uh, no.
But with an American-friendly government running Venezuela, as now seems highly likely, we’d be in a position to stop those tankers from delivering oil to China. That doesn’t mean China wouldn’t still find oil. Remember, oil’s fungible. They’d get it from somewhere else. But you could increase China’s marginal cost for that oil. Would that matter? Maybe. It would certainly make China more vulnerable to some WW2-style Japanese oil embargo—if we wanted to take that step in the future. Might we? Yes, if China invaded—or threatened to invade—Taiwan. All that said, keeping Iranian and Venezuelan oil from reaching China would exert only minor pressure on Beijing. But it’s not nothing. It’s one more factor China would take into account, when considering a Taiwan move.
But Cuba? Roughly half of Cuba’s oil imports come from Venezuela—and on attractive terms that Cuba’s regime could not obtain elsewhere. Put another way, Cuba can’t give up Venezuelan oil and remain a viable state.
So zoom out. I don’t think there was only one reason we decapitated the Venezuelan dictatorship by grabbing their dictator. He was causing lots of mischief, in lots of ways, all of it hurting America and its interests. And we certainly didn’t grab him so as to improve the bottom line for Chevron, and its shareholders. But a pro-US regime in Venezuela would instantly cut off oil shipments to Cuba. Cuba and Venezuela have been the most anti-American, most problematic countries in our hemisphere. If Maduro’s removal—among other things—causes the collapse of the Cuban regime from oil starvation, what a brilliant geopolitical chess move this would prove to be.
And if it gave China sufficient pause to forestall any aggression against Taiwan, that wouldn’t hurt either.
So an argument could be made that—to some extent—it might be about the oil. Specifically: keeping the bad guys from accessing it.