The Caribbean has traditionally been friendly with Venezuela, because of the Petrocaribe program launched by Hugo Chavez. Petrocaribe allowed for poor and/or indebted Caribbean nations to buy oil from Venezuela with dirt-cheap loans. Countries such as Haiti, who are desperately impoverished and for whom importing energy is a very expensive proposition, were more than happy to sign onto the program.
In return, the Caribbean supported the chavistas in multilateral institutions such as the UN, allowing them to escape major international sanctions. This deal worked well for both sides until the Venezuelan economy began to roll over in the last several years. Oil shipments from Venezuela have slowed down drastically and the quality of what they are still producing is very poor.
Trump and Rex Tillerson sensed an opportunity here, and struck while the iron was hot:
The White House is meeting with foreign leaders in the hemisphere to discuss how the U.S. government and energy industry can provide them with fuel and infrastructure needs in the event the Maduro regime collapses and the political crisis in Venezuela chokes off the supply of subsidized oil.
“This is a great time for the U.S. to be both promoting the infrastructure work that the U.S. can do, but also be exporting some of the extra energy that is coming out of the shale deposits,” a senior administration official told McClatchy.
The Trump administration sees an opportunity to wedge itself between countries that once depended on Venezuela oil and the Maduro regime.
David Malpass, the Under Secretary for International Affairs at the U.S. Department of the Treasury, outlined to a group of Latin American and U.S. security experts at the Center for Strategic and International Studies an 11 part strategy he dubbed “Americas grow” or “America Crece.” The goal, he said, is to promote U.S. exports of energy and energy infrastructure and make it easier for U.S. businesses and U.S. finanicial markets to invest.
“The anchor for growth initiatives is the region’s need for energy and infrastructure investment,” Malpass said.
In Jamaica, Tillerson acknowledged the United States was studying how its own oil reserves could help mitigate the impact of potential sanctions.
“I don’t want to get into specifics because we’re going to undertake a very quick study to see if there are some things that the U.S. could easily do with our rich energy endowment, with the infrastructure that we already have available what could we do to perhaps soften any impact of that,” Tillerson said.
The other reason this piece is so interesting to me is the final two quoted paragraphs. If the White House is conducting studies to see the impact of a cutoff of Venezuelan oil, that suggests to me that such an oil cutoff from Venezuela is very likely. If that happens, Venezuela is likely to collapse even faster into chaos and anarchy.
Maduro is already in deep trouble, with more and more people starving to death as Venezuela heads toward a gigantic exodus of refugees and a mass die-off from starvation that could rival the 1933 Ukrainian famine. Things have gotten so bad that even PDVSA workers, who are key personnel critical to maintaining the regime’s infrastructure, are starving to death on the job.
It’s also not just the Caribbean being peeled away from Venezuela.
Traditional allies such as Ecuador are beginning to abandon the regime as well, not wanting to be associated with Maduro’s crimes against humanity. Lenin Moreno, who has begun to carefully walk Ecuador back from the socialist policies of former strongman president Rafael Correa, has been much less inclined to play nice with the chavistas.
This comment from Ecuadorian oil minister Carlos Perez is remarkably cold:
The South American country should address the shortfall on its own, he said on the sidelines of the CERAWeek energy conference, adding: “It is up to (Venezuela) to decide what to do.”
One can only marvel at the grotesque waste of life as Venezuela spirals ever downward to what is now an inevitable conclusion.