Venezuela's Oil Paradox: Why US Pressure Mounts Despite World's Largest Reserves

• Venezuela holds the world's largest proven oil reserves but faces severe economic collapse due to production decline, decaying infrastructure, and sanctions.
• US pressure on Caracas, including naval interceptions and sanctions, is driven by oil as a "subtext" despite official claims of drugs or democracy.
• Venezuelan crude is heavy oil, requiring specific diluents and specialized US Gulf Coast refineries, making it strategically unique and not easily replaceable.
• PDVSA's production collapsed due to under-investment, corruption, and politicized management, with US sanctions freezing the decline and rerouting exports to opaque channels.
• Recent US tanker seizures have sharply cut Venezuelan oil exports, posing an existential threat to PDVSA, highlighting oil's role as a geopolitical leverage point.

Why It Matters: Venezuela's vast, unique oil reserves are central to its economic crisis and the complex US geopolitical pressure.