TRUMP’S VENEZUELA OIL DREAM: $100BN PITCH FALLS FLAT WITH EXXON
GREATRIBUNETVNEWS–USPresident Donald Trump has asked for at least $100 billion in oil industry spending for Venezuela, but received a lukewarm response from major oil firms, with Exxon CEO Darren Woods calling the country “uninvestable”
Key Issues:
– Exxon’s Concerns: “We have had our assets seized there twice and so you can imagine to re-enter a third time would require some pretty significant changes from what we’ve historically seen and what is currently the state.” – Darren Woods, Exxon CEO
– Uninvestable : “Today it’s uninvestable.” – Darren Woods, Exxon CEO
– Security and Legal Frameworks : “There are a number of legal and commercial frameworks that would have to be established to even understand what kind of returns we would get on the investment.” – Darren Woods, Exxon CEO
– US Control : “You’re dealing with us directly. You’re not dealing with Venezuela at all. We don’t want you to deal with Venezuela.” – Donald Trump
– Sanctions and Sales : The White House is working to “selectively” roll back US sanctions on Venezuelan oil, with plans to control sales and deposit revenue into US-controlled accounts.Industry Response:
– Chevron, the only major US oil firm still operating in Venezuela, expects to bolster production.
– Repsol sees a path to triple its production in Venezuela over the next few years under the right conditions.
– Smaller companies are more eager to invest, but likely in the $50 million range, far from Trump’s $100 billion goal .Rystad Energy estimates it would take $8bn to $9bn in new investments per year for production to triple by 2040.
Trump’s suggested $100bn of investment into Venezuela could have a major impact on production – if it were to materialise, said the firm’s chief economist, Claudio Galimberti.
He said companies would only be likely to invest on that scale with subsidies – and political stability. Americans should not expect the situation in Venezuela to lower oil prices anytime soon, he added.
“It’s going to be difficult to see big commitments before we have a fully stabilised political situation and that is anybody’s guess when that happens,” he said.
SOURCE ==BBC==EXCEPT THE HEADLINE AND INTRO PLUS A FEW PARAGRAPHS
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