The discovery of oil in the early twentieth century changed Venezuela’s destiny. The country quickly became one of the world’s largest crude oil producers, with its economy becoming highly dependent on oil prices and lacking in diversity. In 1971, Venezuela was the richest country in South America and its economy was considered a jewel among emerging economies.

With Hugo Chávez’s rise to power in 1999, Venezuela embarked on the “Bolivarian Revolution,” based on social policies financed by oil revenues and facing strong opposition from the United States. After Chávez’s death in 2013, his successor, Nicolas Maduro, found himself facing economic collapse, driven by falling oil prices, and strong internal dissent.

In 2015, during the Obama presidency, the United States accused the Venezuelan government of serious democratic and human rights violations, imposing economic sanctions and politically supporting the opposition. The government in Caracas, on the other hand, perceived these violations as an economic and political attack aimed at worsening the living conditions of the population.

Venezuela has a population of approximately 33 million, and its capital, Caracas, is the country’s main political and economic center, but it also reflects the country’s marked social inequality. The currency is the Venezuelan Bolivar, whose value is practically zero due to hyperinflation. Thus, the “dollarization” phenomenon has become increasingly prevalent, and many businesses now prefer the US dollar. Furthermore, since 2018, the Maduro government has also launched the Petro, a cryptocurrency approved in an unsuccessful attempt to circumvent financial sanctions.

In 2024, the Avenergy Suisse report confirmed that Venezuela is the country with the largest proven oil reserves, with 303 billion barrels, followed by Saudi Arabia and Iran. These reserves represent approximately 18% of the world’s total and are located primarily in the Orinoco Belt, an area of ​​55,000 square kilometers. This area primarily produces extra-heavy crude oil, which requires more complex and expensive refining processes.

Until 2019, the United States was the main buyer of Venezuelan oil, but sanctions imposed during the Trump presidency have drastically reduced trade. Currently, most Venezuelan oil is exported to China, often through opaque methods to circumvent trade restrictions. This shift has had a significant impact on Venezuela’s oil industry, which has seen a sharp decline in exports.

Venezuela is the world’s largest oil producer. Proven gas reserves (especially offshore) are also extremely important, amounting to over 5.5 trillion cubic meters, considered the largest in South America and the eighth largest in the world.

Venezuela is known for its vast diamond reserves, which are concentrated primarily along the Caroní River basin in the Guayana region. This area is considered one of the richest in diamonds, with diamond-producing areas such as La Paragua, Icaribú, Paraytepuy, and Urimán. The diamonds mined in the country are of the Industrial, Gem, and Bort types. Diamond production in Venezuela has a significant economic impact, generating an annual revenue of approximately $30 million, but in recent decades this activity has become informal and illegal, reducing national income.

Venezuela, particularly in the Orinoco Mining Arc region, is also known for having significant deposits of rare earth elements. This area is rich in minerals and has significant mining potential estimated at billions of dollars, including resources such as gold and oil. The discovery of coltan deposits, from which tantalum is extracted, has further increased interest in the country’s mineral resources.

Naturally, with these data, the interest of many countries was a given, particularly that of the United States, which has repeatedly stated, through President Trump, the importance of areas rich in oil deposits and rare earth extraction sites.

The assessment to be made now is the potential worsening of diplomatic relations between the US and China, the latter having already condemned the American operation in Caracas and calling for Maduro’s immediate release. China might think it is justified in invading Taiwan.

The night between January 2nd and 3rd represents not only an operation against a dictatorship and the protection of human rights. It represents an event that will lead to a new balance in the trade and diplomatic relations of world powers.

By Domenico Greco