Is Obama’s Caribbean Visit a Death Knell for Venezuelan Oil?

fuel hose

Recently, U.S. President Barack Obama embarked on a three-day trip to Central America and the Caribbean for what was much more than a tropical getaway.

The President’s recent visit to Jamaica marks the first time a sitting president has visited the country for 33 years. Obama’s trip also marked the first time Obama and Cuban leader Raoul Castro have met since the U.S. and Cuba began to normalize their relations late last year.

But perhaps the most important purpose of Obama’s appearance at the Summit of the Americas in Panama? Venezuelan oil — and how to help the nations of the Caribbean wean themselves off it.

According to an April 8 Bloomberg article, Venezuela, an adamant critic of the U.S., has long used subsidized oil to gain allies and extend its influence throughout the Caribbean. With Venezuela’s oil-dependent economy torn apart by American sanctions and its 69% inflation rate, Obama’s intent was to encourage alternatives to Venezuelan oil.

The timing of his visit was perfect. Over the last year, as global crude oil prices have dropped more than 50%, the nations of the Caribbean have become significantly less dependent on Venezuela’s subsidized oil program, Petrocaribe.

Most countries in the region are ready to move away from imported petroleum as an energy source, especially when global proved oil reserves have risen by 27% over the last 10 years — more than 350 billion barrels. In fact, it’s believed that Venezuela’s economic troubles are one of the major underlying factors in longtime ally Cuba’s decision to warm up its relations with the U.S.

“For the last year plus, the U.S. government has become incredibly interested in the Caribbean and looking for ways to step in to help transition countries away from Petrocaribe and cloaking it in the admirable goal of reducing petroleum products,” said Alexis Arthur, an energy policy analyst at California-based think tank Institute of the Americas.

In countries like Jamaica and the Dominican Republic, energy is an “Achilles heel” — without imported oil, they have no way to generate electricity — leading to economic instability, and eventually to social upheaval. By helping these countries find alternate energy solutions, the U.S. is subtly expanding its influence in the region.

Obama’s visit didn’t come without resistance — at the Summit of the Americas, Venezuelan President Nicholas Maduro presented him with a petition signed by 10 million Venezuelans that protested the strict sanctions the U.S. has imposed on their country, Vox reports.

Leave a Reply

Your email address will not be published. Required fields are marked *