Venezuela’s pseudo-newish-kinda leader, Delcy Rodríguez, just offered President Trump 30-50 million barrels of Venezuelan oil. Let’s just call a spade a spade, because this is an overt political bribe.
Rodríguez is trying to earn Trump’s stamp of approval, so her seat at the table is secured (spoiler alert: she’s no different than her predecessors). But this bribe has some logistical motivation as well. You see, the embargo on Venezuelan oil exports has left storage tanks full. And with nowhere else to store the crude, they either have to get rid of it quick or shut down production.
The US has a legal nightmare on its hands, because isn’t this still sanctioned oil? Are the refineries allowed to accept the stuff? Regardless, this oil bribe can either buy Venezuela some time (and secure a new leader’s seat) or mark the end of Venezuela’s status as an oil producer.
Hey, all on here come from Colorado. Today we’re talking about the bribe of the Donald Trump announced last night. I think there’s no other way. There’s no other word for it. Are you one on Truth Social and said that Venezuela was going to give or sell? Details were a little fuzzy. Somewhere between 30 and 50 million barrels of crude to the United States to be sold in the US markets, to be accepted, U.S ports to be processed by U.S refineries, and that he personally would manage the sale and, handle the proceeds personally.
As the president of United States for the benefit of Venezuela and the United States. Details TBD.
Two things here. Number one, it’s really weird to have a sitting president be really proud of a bribe. But, you know, here we are. It’s a weird, weird world these days. Second, the mechanics of why this is happening. The new president of Venezuela, Rodriguez, is attempting to flat out bribe the American president.
This is not the first time she’s tried this. She came back in 2019. Remember? She’s also the oil minister and tried to give money to his election campaign. Didn’t work then. Now seems to be working. But she is trying to get the American stamp of approval that she is the thug in charge. She is not any better than Nicolas Maduro or Hugo Chavez.
She simply is bending with the political winds. Right now, she’s established a far tighter crackdown in just the last three days. The Nicolas Maduro never did, even at the height of the elections. She wants everyone to realize that she is in charge and she has trumps behind her. For her new reign of tyranny. And of course, she was selected because she was very good at looting the system.
So it’s a really interesting, political bedfellows, whether it will work or not depends on a thousand different things that I can’t predict right now. But let’s talk about that oil. The way oil systems work is you have a production. Well, it goes into a pipeline, it goes to a refinery, the refinery processes it, and then it goes on you typically by truck, train or some other method of transport to end users.
And the trick is you have to maintain a flow all through there. Because if you have a hang up at one step, the pipeline will then have to divert its shipments off into, say, a storage tank. And storage tanks can only use so much. And for a country like, say, the United States, where we use something like 17 million barrels a day, you’re talking about a lot of flow through.
Well, if you’re an exporter, you don’t necessarily refine your crude. It’s even more important then, because there’s no place to offload, there’s no local demand center that is strong enough to absorb a lot of the raw crude. So your only options then are tanks. And that’s the situation that Venezuela is in. Now. You see, a couple weeks ago, the Trump administration announced a full embargo on basically anything that wasn’t Chevron.
And in doing so, tankers stopped arriving in Venezuela. So they had to start diverting all of their export flows to storage tanks. Now Venezuela has more storage tanks than most exporters, mostly because it’s not the exporter it used to be. They used to export 3 million barrels a day. Now it’s less than one, which means they actually had a fair number of tanks.
But after two weeks, those have basically become full. And we’re now in the point that in the next day or three, if they can’t release that crude onto tankers to take it away, they’re going to have to shut down production because there’s no place else to put it. That’s the 30 to 50 million barrels. Gives you an idea of how little control the Venezuelans have over the intellectual property of their own system.
They don’t know if it’s 30 million or 50 million. They just need someone, anyone, to take it in any price. Otherwise they have to shut everything down. And here is Donald Trump. So Rodriguez offers Trump the bribe. Trump seems very grateful. And we will find out in the next 48 hours whether or not the tankers will actually take it and carry it to the United States, and whether U.S refineries will accept crude that the president has very explicitly said is still under sanction.
There’s a lot of legal questions there. And the people who would help untie those legal questions are the experts and, the people who basically do ethics investigations, the United States government, and they have all been fired. So a lot of people going to have to make a lot of really difficult decisions on legal liability very, very, very soon. But that’s the nuts and bolts of the issue. If this doesn’t work out the way that Rodriguez and Trump have identified, then the tankers don’t come. The oil stays in the tanks, and the entire Venezuelans oil sector basically shuts down, with the exception of what they can refining themselves, which is less than a quarter of a million barrels a day.
So this could buy them some time to figure out something else. Or we could be at the end of Venezuela as an oil power right now.
