The Trump administration’s decision to ease Venezuela’s return to global oil markets has highlighted the real stakes behind the pursuit of President Nicolás Maduro and his wife, Cilia Flores. Publicly framed as a law-enforcement action tied to narcotics allegations, the move is more fundamentally about energy control, dollar dominance, and strategic rivalry with China.
Venezuela holds the world’s largest proven oil reserves, estimated at more than 300 billion barrels. That scale gives the country influence far beyond its weakened domestic economy. How its oil is produced, priced, and traded carries implications not only for US energy security but also for the long-term balance of global power.
For years, Caracas pursued policies that unsettled Washington. In 2018, the Maduro government announced plans to reduce reliance on the US dollar in oil transactions, opening payments to currencies such as the Chinese yuan and the euro. This shift formed part of broader financial and energy cooperation with China and reflected an explicit desire to operate outside dollar-dominated systems. Venezuela also sought closer ties with the BRICS bloc, whose members have explored alternatives to dollar-based trade and finance.
These steps challenged a cornerstone of American economic power. Since the 1970s, global oil trade has largely been conducted in dollars, a structure rooted in agreements that linked oil pricing to the US currency in exchange for American security guarantees. This arrangement, often described as the petrodollar system, has helped sustain global demand for dollars, enabling the United States to finance deficits, project military strength, and maintain worldwide economic influence.
History shows that challenges to this system have often been met with force. Iraq’s move to sell oil in euros preceded the US-led invasion in 2003, while Libya’s push for a gold-backed African currency for oil trade came shortly before NATO’s 2011 intervention. Regardless of official justifications, these episodes illustrate the long-standing link between energy, currency dominance, and geopolitical power.
Venezuela posed an even more significant challenge. Its reserves are vast and long-term, its geographic position strategic, and its partnerships consequential. China has played a central role as both a major buyer of Venezuelan oil and a key creditor. Beijing’s broader strategy includes expanding the yuan’s role in global energy trade, and a sustained shift by a major oil producer away from the dollar would have strengthened that ambition considerably.
Statements from US officials shed further light on Washington’s concerns. American firms lost operational control of Venezuelan oil assets under Hugo Chávez and later Maduro, leading to arbitration disputes over compensation. Yet both international law and Venezuela’s constitution affirm that the oil itself belongs to the Venezuelan state. The disagreements centred on control and compensation, not sovereignty.
Domestic political considerations also sharpened US urgency. Trump has repeatedly pointed to low fuel prices as evidence of economic success, including through releases from the Strategic Petroleum Reserve. Replenishing that reserve and ensuring supply stability are legitimate policy goals, and Venezuelan oil offered a convenient means to that end.
Foreign confrontation also had the effect of pushing domestic pressures out of the spotlight. Issues such as renewed scrutiny of the Epstein files, persistent inflation concerns, the unresolved legacy of January 6, ongoing legal and ethical controversies surrounding the presidency, and rising public anxiety over inequality receded as attention shifted to dramatic developments abroad. External crises often refocus public debate on leadership and national security, diverting scrutiny from internal challenges.
In the short term, Washington has achieved tangible results. Political change in Caracas has reopened space for US and allied oil companies. Venezuelan production is expected to rebound, and exports are likely to return largely to dollar-based markets. From the US perspective, this appears to reinforce both energy security and the dollar’s central role in global oil trade.
Yet the longer-term consequences are more ambiguous. The global energy and financial system is already evolving. Since the war in Ukraine, Russia has expanded non-dollar energy transactions. Iran has long traded outside the dollar under sanctions. China has built alternative cross-border payment systems, while BRICS members continue to explore non-dollar settlement frameworks. Gulf states, led by Saudi Arabia, have signalled openness to currency diversification in energy sales. Together, these shifts reflect a broader reassessment of the foundations of the global financial order.
Against this backdrop, intervention in Venezuela may accelerate the very trends it seeks to restrain. It sends a clear signal that deviation from dollar dominance carries political risk. For many countries, that message may encourage deeper efforts to reduce exposure rather than compliance. Dependence on a single currency increasingly appears less a guarantee of stability than a strategic vulnerability.
China, despite any short-term setback in Venezuela, continues to expand its influence through trade, infrastructure investment, and long-term financial partnerships. Its strategy relies less on coercion and more on incentives, credit, and market access. While the United States often seeks to defend the existing order through pressure, China positions itself to shape what comes next.
A similar dynamic is emerging in Greenland. US engagement has shifted from provocative talk of acquisition to structured diplomacy. Secretary of State Marco Rubio is expected to meet Danish officials to discuss Greenland’s future amid rising tensions over sovereignty. Early rhetoric risked straining relations with Denmark and Europe, but the current emphasis is on economic cooperation, security coordination, and dialogue that preserves alliance unity.
Influence built through sustained engagement tends to outlast authority imposed through unilateral pressure. By prioritising partnerships and dialogue, Washington is adopting methods long used by China in the global south, where patient investment and economic integration have proven effective in embedding influence.
Greenland’s importance lies in both resources and geography. The island holds significant deposits of critical minerals, including rare earth elements essential for electric vehicles, renewable energy systems, and defence technologies. As climate change opens new Arctic shipping routes, Greenland’s position between North America and Europe further enhances its strategic value.
The experiences of Venezuela and Greenland carry important lessons for Nigeria. Recent dealings with the Trump administration underscore the dangers of overreliance on external powers or a narrowly based economy. True strategic autonomy requires deliberate diversification of energy sources, economic structures, and international partnerships. Internal security capacity is equally vital. A sovereign state must strengthen its technological, intelligence, and surveillance capabilities while reducing dependence on external guarantees that can shift with changing global priorities.
In an international system driven by pragmatic self-interest, Nigeria’s long-term security and prosperity will depend less on foreign intervention and more on choices made at home.
Ladigbolu, a journalist, writes from Lagos.
.jpeg)
0 Comments