The US capture of Venezuelan President Nicolás Maduro is the beginning of a new era for the country's oil industry, at least according to Donald Trump.
In interviews afterward, the US president has promised massive investments from American oil companies and, according to Senator Marco Rubio, there is "dramatic interest" from the companies.
The assets are also enormous; Venezuela has the world's largest untapped oil reserves, but production has historically been far below that. Years of corruption, lack of investment and theft have meant that production currently amounts to one million barrels per day, a quarter of what it was in the 1970s.
Major investments
According to Francisco Monaldi at Rice University in Houston, Texas, investments of around $10 billion, just over 92 billion kronor, are required annually for a decade from American oil companies such as Chevron, Exxon and ConocoPhillips.
A faster recovery would require even greater investments, he told Bloomberg.
Currently, the country's oil infrastructure is so underdeveloped that it takes five days to load a supertanker, whereas seven years ago it took one day.
Rusty and leaking oil pipelines have been a recurring problem, as have fires and explosions. Further evidence of how substandard the oil industry has been is equipment being stolen and then sold on the black market or as scrap metal.
Production can be expanded
However, the major bank J.P. Morgan said in an analysis that production could be increased to 1.3–1.4 million barrels per day within two years. At present, however, there is only one American player, Chevron, with operations in the country. Exxon and ConocoPhillips, which are mentioned as possible players, had their oil assets confiscated during Hugo Chávez's presidency.
Australian bank Westpac is now among those who are hesitant about the investments:
"There will remain question marks over political stability in Venezuela. It's hard to see companies like Exxon and ConocoPhillips returning quickly without guarantees of political stability," the bank's commodities expert Robert Rennie told Bloomberg.
However, the market is more optimistic. In pre-market trading on Wall Street, Chevron is up 10 percent, while ConocoPhillips is up 8.7 percent and Exxon is up 3.4 percent.
