Trump’s Coup in Venezuela: The Full Story

Eric Draitser

The US-sponsored coup in Venezuela, still ongoing as I write, is the latest chapter in the long and bloody history of US imperialism in Latin America. This basic fact, understood by most across the left of the political spectrum – including even the chattering liberal class which acknowledges this truth only with the passage of time and never in the moment – must undergird any analysis of the situation in Venezuela today. That is to say, the country is being targeted by the Yanqui Empire.

This point is, or at least should be, indisputable irrespective of one’s opinions of Venezuelan President Maduro, the Socialist Party (PSUV), or the progress of the Bolivarian Revolution. Imperialism, and its neocolonial manifestation in the 21^st Century, is there to pick clean the bones of the Bolivarian dream and return Venezuela to the role of subservient asset, an oil-soaked proxy state ruled by a right-wing satrap eager to please the colonial lords of capital.

But in providing analysis of the situation, the Left must tread carefully with the knowledge that though it may be weak, disorganized, fragmented, and bitterly sectarian, the Left remains the principal vehicle for cogent analysis of imperialism and its machinations. This historic role that the Left has played, from Lenin and Mao to Hobsbawm and Chomsky, is of critical importance as analysis informs discourse which in turn ossifies into historical narrative.

And with that weighty and historic responsibility, the Left is duty-bound to understand at a deep level what we’re witnessing in Venezuela. Moreover, the Left must beware the pitfalls of shallow, superficial analysis which can lead to poor understanding of material reality, and even poorer anti-imperialist politics.

It’s the Oil…Or Is It?

One could be forgiven for immediately assuming that the blatantly illegal coup, and its near instantaneous recognition by the Trump Administration (among others), is proof positive that the US has instigated the overthrow of the Bolivarian Revolution in a nakedly aggressive action to steal oil resources. Indeed, this would be a near textbook example of the sort of colonial policies visited upon the peoples of the Global South since the dawn of the colonial age.

And there’s no doubt some truth to the conclusion. As Democratic presidential hopeful Tulsi Gabbard noted on Twitter, “It’s about the oil…again,” referencing the parallel to the Bush Administration’s crime against humanity known as the Iraq War which was, in no small part, about enriching Dick Cheney’s Halliburton, and the US oil industry broadly speaking.

And Gabbard is correct to highlight statements by Trump’s National Security Warlock, John Bolton, whose every word oozes the sociopathy we’ve come to expect from this most hawkish of neocons. Bolton stated in a press conference, “We’re in conversation with major American companies now…it would make a difference if we could have American companies produce the oil in Venezuela. We both have a lot at stake here.”

Leaving aside the likely deliberate ambiguity of these statements – What are these “conversations”? Does this mean there was no production plan before the coup was initiated? etc. – it seems obvious that oil is a major motivating factor.

But why, exactly?

As anyone with even basic knowledge of the global oil market can tell you, there are a number of reasons why we should be skeptical of the idea that the US simply wants to rake in profits by stealing Venezuela’s oil, its primary resource and export revenue generator.

First, global oil prices have remained fairly depressed in comparison to the historic highs of just a decade ago. With the price per barrel hovering somewhere between $50 and $60 today, Venezuelan crude remains profitable, but due to its heavy qualities, it requires somewhat more expensive refining technologies, making it less attractive than some other oil reserves, most notably shale.

This is not to say that oil companies would not be interested in looting this natural resource, as evidenced by ExxonMobil desperately trying to control the Essequibo region which continues to be a source of competing territorial claims between Guyana and Venezuela. The USGS estimated roughly 15 billion barrels of undiscovered oil and 42 trillion cubic feet of gas reserves lie under the Guyana Suriname Basin, making it 2nd in the world for prospectivity among the world’s unexplored basins and 12th for oil among all the world’s basins – explored and unexplored.

However, from a pure profit perspective, Venezuelan oil remains far less profitable (and stable from an investor perspective) than investing in the Permian Basin in Texas where the fracking boom, also hampered by global oil prices, has continued unabated. Indeed, with the US becoming an exporter of oil, and potentially the most productive oil field in the world in the Permian Basin, the appetite for simply snatching Venezuela’s oil supply would seem to be less.

And yet, here we are. So, what gives?

The View from Washington and Moscow

In fact, the fixation on Venezuela’s oil is only part of the story. The real story is the politics, and geopolitics, behind control over the oil. Put simply, control of Venezuelan oil is part of the broader international conflict with Russia, and perhaps to a lesser degree China.

In 2016, as Venezuela’s economy was in freefall due in no small part to the historic lows in oil price ($35 per barrel in January 2016), the Maduro government took the controversial decision to stake 49.9% of its ownership in PDVSA’s US subsidiary, Citgo, to the Russian state oil company Rosneft in exchange for a $1.5 billion loan. In essence, the Kremlin gave Caracas a very temporary bailout with major strings attached. With this move, the Russians effectively became part owners of Venezuela’s primary asset.

But Russia, being one of the world’s leading oil producers itself, surely had little interest in the oil per se. After all, Russian energy exports remain dominant in Europe, with expanding operations in Asia. Instead, Venezuelan oil was to be a potent lever against the US at precisely the moment the US was applying political and economic pressure on Moscow over the conflict in Ukraine, among other things. It should be remembered that the Obama Administration had imposed sanctions against Moscow in March 2014 over the Russian annexation of Crimea, and later involvement in the civil war in Eastern Ukraine.

With the US and European sanctions, some of which targeted Russia’s oil industry, the Kremlin was desperate for strategies to leverage against the US both to extract a cost for the sanctions, but perhaps more importantly for potential future negotiations. Putin & Co. settled on, at least in part, Venezuela’s oil sector. By providing what amounted to a relatively small loan of $1.5 billion, Russia immediately became a dominant player in Venezuela’s oil, thereby becoming a power player with Washington’s political and economic strategy.

And indeed this strategy, or at least recognition of it, was confirmed by powerful US interests in early 2018 when a still shadowy group of US investors made a move to try to purchase the Russian stake in Citgo.

Essentially, the plan, which was revealed to Reuters by an anonymous investor who is part of the group, called for the investors to pay off Venezuela’s outstanding loan balance and then require Rosneft to terminate its lien and transfer the loan to new investors. As the investor told Reuters:

“The [Trump] administration should recognize that if it doesn’t do something pro-active here, it will face…limited options under almost any scenario, whether it is an attempt to foreclose by the current lienholder, further restrictions on Venezuelan crude oil imports into the U.S., or even in the event there is a positive political change in Caracas… This is a private sector solution to a public policy problem.”

It doesn’t get much clearer than that. US elites clearly felt that Russia’s foray into Venezuela’s oil sector was a strategic calculation designed to counteract US political and economic moves against Russia. Moreover, it seems obvious that there is/was a lack of faith on the part of segments of the ruling class that the Trump Administration would actively block Russia’s geostrategic maneuvers effectively, hence the need for a “private sector” solution.

And yet here we are, less than 12 months after the news of this potential strategy broke, and the Trump Administration is doing precisely what the ruling class demanded, namely targeting Venezuela’s economy, specifically the oil sector. As the recent move by the US Treasury makes clear, the US will use Venezuelan oil revenues as part of a hostage-taking strategy designed to force regime change which would make moot the question of Russian power in Venezuela as the new government would be, for all intents and purposes, a US puppet regime.

One can almost hear the shrill cries of Trump’s apologists on left and right who will cry in the night about the Deep State forcing Trump to do this, that he has no choice as it is the will of the ruling class which has weakened him with the Russiagate hoax.

But, leaving aside the unbearable blitheness of being MAGA-adjacent, the reality is that Trump has warmongered against Venezuela since well before the recent escalation, including in an infamous 2017 meeting at which ExxonMobil’s State Department CEO Rex Tillerson and former National Security Advisor H.R. McMaster both were “stunned” at the stupidity of Trump’s expressed desire to invade Venezuela. According to the Associated Press:

“Trump alarmed friends and foes alike with talk of a “military option” to remove Maduro from power. The public remarks were initially dismissed in U.S. policy circles …But shortly afterward, he raised the issue with Colombian President Juan Manuel Santos, according to [a] U.S. official. Two high-ranking Colombian officials who spoke on condition of anonymity to avoid antagonizing Trump confirmed the report.”

So, it seems Trump never needed any help getting to the war criminal perspective on Venezuela. In fact, it could be said that, ironically enough, it was an oil man and a Pentagon man who tried to talk him out of it. So much for the Deep State. Instead, it was simply that Trump needed the right kind of crazies around him to indulge his imperialist insanity; he has them now with a messianic Secretary of State in Pompeo and the aforementioned National Security Warlock Bolton.

Imperialism a la Carte

I’ve tried to highlight the more nuanced analysis of the energy issue, and how it ties to broader geopolitical questions so that, hopefully, leftists can see the full picture of the political context, rather than a one-dimensional, reductionist one. However, it must be said that oil is not the only issue requiring careful analysis.

There is also the question of mineral extraction, and there too Russia figures centrally. In late 2018, President Maduro, desperate to get additional financing amid crippling sanctions, announced that Venezuela had offered Russian mining companies access to gold mining operations in the country. While the Kremlin’s media platforms like RT and Sputnik did their usual spin, presenting this as simply mutually beneficial, friendly, and downright altruistic policy from Putin, the reality is that Russia sees in Venezuela much the same as what US interests see: a cash cow on its knees, easily controlled and exploited.

And of course, in addition to gold, there are plenty of other mining prizes to be had in Venezuela including nickel, diamonds, iron ore, aluminum, bauxite, natural gas, etc. Both Russia and China have a significant interest in all these minerals, and projects necessary to exploit them.

Washington is not necessarily most concerned with Russian and Chinese billionaires enriching themselves in Venezuela, though it is undoubtedly irksome.

Rather, the strategic planners inside the Beltway see in Venezuela today an opportunity to strike a death blow to socialism and anti-imperialist politics in Latin America. While they shed crocodile tears over elections, democracy, and corruption, the reality is that the vultures of Empire are circling around what they feel is a carcass to be stripped clean. No more Bolivarian Revolution means not even the pretense of, let alone substantive movement for, regional integration.

With Chavez gone, and Venezuelan people hurting and desperate, people like war criminal and newly appointed envoy to Venezuela, Elliott Abrams, see an opportunity to win a major victory in their endless fight against socialism on the one hand, and petro-capitalist Russia on the other hand. And if they can stick it to China in the process, depriving it of a significant export market and diplomatic foothold in the Western Hemisphere, all the better.

Ultimately, what we’re witnessing is the classic Monroe Doctrine policy from the US, albeit under 21^st Century conditions. With a consolidated right-wing front already in place under Duque (and his puppet-master former President Alvaro Uribe) in Colombia, Macri in Argentina, and Bolsonaro in Brazil, Washington sees Venezuela as perhaps the last domino to fall in South America (Bolivia notwithstanding). And with its demise, the region will be America’s backyard once more.

Unfortunately for the Empire, I’ve seen the Bolivarian Revolution with my own eyes, seen the commitment of poor and working-class people to the ideals of Chavez’s vision and of socialism from the ground up. These people, in their millions, are not simply going to watch as the US takes everything they’ve bled for these last twenty years. They’re not going to sit idle and play the victim.

If Trump thinks he will take Venezuela without a bloody fight, he’s even dumber than we thought.