It is not about Maduro or Venezuelan oil. It is about raw materials, China and control of Latin America

The US military special operation in Venezuela, which resulted in the capture of dictator Nicolás Maduro, drew the attention of the entire world in the first week of the new year. With this move, the United States sent an unequivocal message to the southern half of the American continent: “This is our hemisphere”, in other words “This is our hemisphere”. Much more than Venezuelan oil is at stake.

Much is known about Venezuela’s oil wealth. The country holds the world’s largest proven oil reserves, estimated at around 300 billion barrels, representing approximately one-fifth of global reserves. However, this is predominantly heavy, sour crude, which is technologically demanding to refine. This does not pose a major problem for its use in, for example, asphalt production. US President Donald Trump announced that Venezuela will now hand over up to 50 million barrels of oil to the United States at market price.

Although oil is frequently invoked in this narrative, and undoubtedly ranked among the obvious objectives, it was certainly not the only goal. Venezuela’s oil sector is in a dire state after years of sanctions, underinvestment and mismanagement. The necessary repairs and modernisation will require years of work, which entails significant risks at a time of the global shift away from fossil fuels, particularly regarding returns on investment.

More important than the oil itself is therefore the signal sent – a clear confirmation of the US presence and influence in Latin America. The new security strategy, published by the White House in November last year, offered many clues in this respect.

“The United States must never be dependent on any external power for essential components, from raw materials through parts to finished products, needed for the nation’s defence or economy. We must once again ensure our own independent and reliable access to the goods we need to defend and preserve our way of life. This will require expanding America’s access to important minerals and materials,” the document states.

Not just hydrocarbons

Starting with Venezuela, which in addition to oil also possesses, for example, Latin America’s largest gold reserves, the United States is securing its critical raw materials needs. Venezuela’s geological wealth extends far beyond hydrocarbons. Proven and historically exploited mineral resources include iron ore (particularly the Cerro Bolívar and El Pao deposits in the Guiana Shield area), bauxite, gold, coal and nickel. The country is also a known source of coltan, a niobium-tantalum ore.

According to Reuters, the Venezuelan government published a mineral resources map in 2021, based on 2009 data, which also listed occurrences of antimony, copper, molybdenum, magnesium, silver, zinc, tungsten and uranium – but without specifying volumes. The lack of quantitative data reduces the credibility of these claims, yet the presence of such occurrences itself may be of considerable significance. Above all, however, this is geological potential that remains insufficiently explored and unverified on a commercial scale. At least for now.

With the United States entering Venezuelan territory and announcing it will administer the country in the coming years, we can expect to learn more about the actual extent and composition of this mineral wealth. No significant commercial mining is currently taking place there, but this may change in the future. Unlike Ukraine or the Democratic Republic of the Congo, where the United States is also involved, the Venezuelan case is, for now, of a markedly more speculative nature.

South America’s key position

Even if Venezuela ultimately proves not to possess, in itself, as extensive and economically viable reserves of critical materials as current surveys suggest, the US intervention nevertheless has much broader strategic significance. The United States has entered a region which, as a whole, represents one of the world’s greatest mineral potentials. South America holds key positions in the global battle for critical raw materials.

According to the US Geological Survey, Brazil has the world’s second-largest reserves of strategic minerals and dominates niobium production, which is essential for manufacturing high-quality steels. Bolivia has the largest known lithium reserves, a key element for electric vehicle batteries. Chile, Peru and Colombia are considered important sources of copper and rare earths. Control over, or at least political influence in, this area therefore offers the possibility of reducing dependence on China, which in recent years has built a dominant position not only in mining, but above all in the processing and logistics of these raw materials.