CRUDE ECONOMICS

Trump Admits U.S. Taxpayers Are on the Hook for His Venezuelan Oil Plan

The president says it will cost a “tremendous” amount to salvage Venezuela’s oil industry.

Donald Trump has admitted that American taxpayers could be tapped to fund the “tremendous” investment needed to upgrade oil production in Venezuela.

After U.S. special forces removed Venezuelan President Nicolás Maduro from power in a pre-dawn raid on Saturday, Trump said he planned to seize the country’s huge oil reserves and put them under the control of American oil companies.

In a new phone interview with NBC News on Monday, Trump admitted that his plans would come at a major cost—with American taxpayers potentially picking up the bill.

Trump said he believes the U.S. oil industry could expand operations into Venezuela in under 18 months.

“I think we can do it in less time than that, but it’ll be a lot of money,” Trump said.

“A tremendous amount of money will have to be spent, and the oil companies will spend it, and then they’ll get reimbursed by us or through revenue,” he said.

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The 79-year-old declined to put a figure on the cost to upgrade Venezuela’s aging oil facilities.

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“It’ll be a very substantial amount of money will be spent” by the oil companies, Trump said. “But they’ll do very well, and the country will do well.”

While Venezuela is estimated to have around one-fifth of the world’s total oil reserves, their “badly broken infrastructure” according to Trump means their daily oil production accounts for less than 1 percent of the global total.

Much of the 300 billion barrels of estimated reserves involve super-dense crude oil, which is simply not economic to extract and process at current world market rates.

It is also not clear whether American oil majors that gave up on Venezuela during the rule of Hugh Chávez, Maduro’s socialist predecessor, are keen to return, let alone fund an investment program that experts say could cost up to $200 billion.

The president claimed that oil companies were not specifically briefed on the military invasion before it took place, but said his administration had been “talking to the concept of ‘What if we did it?’”

“The oil companies were absolutely aware that we were thinking about doing something,” Trump told NBC. “But we didn’t tell them we were going to do it.”

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The president also claimed that the move for American oil companies to overhaul Venezuela’s oil infrastructure will lower the price of the fuel.

“Having a Venezuela that’s an oil producer is good for the United States because it keeps the price of oil down,” Trump said in the interview.

Trump said it was “too soon” to reveal if he had discussed his plans with the bosses of Exxon Mobil, Chevron, and ConocoPhillips, simply claiming “I speak to everybody.”

Seventy-two percent of Americans are concerned about America getting too involved in Venezuela, according to a poll taken this week. However the president said the U.S. was at war with “people that sell drugs” not the Latin American country.

“We’re at war with people that empty their prisons into our country and empty their drug addicts and empty their mental institutions into our country.”

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