Venezuela: Authoritarianism through Oil

Nicolás Maduro with his wife, Cilia Flores, standing at the National Assembly after being sworn in as President of Venezuela, Friday, January 10, 2025. (AP Photo/Ariana Cubillos)

A sense of hope perished on January 10th, 2025, as Nicolás Maduro became the President of Venezuela for a third consecutive time after his Presidential Inauguration played out in Caracas. Maduro has again assumed power despite public outcry over the lack of transparency in last year's election. Venezuela has dramatically suffered at the hands of Maduro and his authoritative rule, which has led the country toward economic collapse, jailed thousands of political prisoners and sparked one of the most significant current refugee crises in the world. However, Venezuela has endured the effects of authoritarianism for decades, beginning with Hugo Chávez, who passed laws restricting criticism of the government by journalists and removing checks on his authority. The longevity of Venezuela’s authoritarian rule stems from several factors, but one in particular helps to understand the country's circumstances further: oil.

Chavez’s regime, and now Maduro’s, has imposed dictatorial status by making Venezuela a petrostate; as Venezuela is the country with the largest oil reserves in the world, its economy heavily relies on this resource. Furthermore, it is essential to note that Venezuelan oil is nationalized, transferring the oil industry from the private to the public sector and in the hands of the Venezuelan government. As a result of its tremendous oil wealth, Venezuela has enriched itself through extensive exports over the last few decades. In 2024, Venezuelan oil exports increased to 10.5% despite the ongoing political turmoil within the country. Today, the government is highly dependent on these exports. The revenue of PDVSA, a state-owned oil and natural gas company in Venezuela, is projected to cover 58% of the government's 2024 spending budget.

Venezuela holds several trading partners that import oil. Currently, China is Venezuela’s most important oil importer. In 2023, they imported roughly 65% of Venezuela’s oil exports. Perhaps more interestingly, the US accounted for 19% of Venezuelan oil shipments in 2024, while Europe accounted for 4%. The US has been a major player in Venezuelan oil since the start of the 21st century, it has invested billions of dollars annually in Venezuelan oil imports. By 2011, Venezuela was the fourth-largest oil supplier to the US. Thousands of barrels entered the United States from Venezuela daily for almost twenty years. Even though Europe has not imported nearly as much Venezuelan oil as the US, it has made significant gains recently. For example, Spain has massively increased its oil imports from Venezuela in 2024 compared to 2023, almost tripling the amount it brought in. 

With these oil exports, authoritarianism has been maintained in Venezuela, mainly through the armed forces who have been a key player in backing first Chavez and now Maduro. High-ranking officials of the armed forces have been given essential government positions, mainly the heads of the National Guard, who were the presidents of PDVSA. Moreover, Government spending has gone toward buying the loyalty of members of the armed forces to crack down on Venezuelans. The country’s economic strength in oil has thus been able to appease the armed forces through government positions and money to impose rule upon their people. With this in mind, it is important to consider the customers that Venezuela has maintained. Such customers are providing Maduro with the wealth needed to impose authoritarianism in the country. As was previously mentioned, China is the most important customer for Venezuelan oil. China has not been critical of the Venezuelan government; on the contrary, they congratulated Maduro on his election win. China, like Venezuela, are authoritative states that significantly lack democratic values. There is no shock then in governments with similar systems working together, especially with the amount of oil China imports from Venezuela; the two countries have an important trade relationship.

The surprise appears more with the US and Western Europe, as they are considered to hold greater democratic values than that of China and Venezuela. The US has even spoken about Venezuela’s authoritarianism, and the EU recently has questioned Maduro’s election win. It questions why they would negotiate with a state that maintains authoritarian values. The answer becomes clear when looking at these states and their motivations. In the US, importing Venezuelan oil can be cheaper than producing their own as the refineries in the US process certain oils that come from Venezuela. Thus, the US saves money by importing rather than refining its oil. The interests of oil multinational corporations (MNCs) also play a role for the US, as the Chevron Corporation is a key player in  Venezuela's oil and gas market. Chevron has lobbied the US government for years to exempt Venezuela from sanctions. Eventually, the US granted them licensing to pump Venezuelan oil. Chevron is also looking to pay back billions in debt owed to Venezuela. The case for Europe is different as they have tended to rely heavily on energy coming from Russia and are now looking to diversify themselves. Venezuela has proven to be a reliant trading partner for this matter. In 2021, around 27% of the European Union’s oil imports came from Russia, Europe’s energy security would be strengthened if Venezuela could assist in lowering this number. Venezuela’s location is also beneficial as oil transportation can become more efficient and less costly than other suppliers. Lowering costs, protecting corporations and ensuring energy security are why the US and Europe import Venezuelan oil.

The Venezuelan government’s wealth from oil exports has allowed it to impose its will upon its people. The Maduro regime has routinely thrown countless political opponents in jail on trumped-up charges. There have been crackdowns on protesting through force, even leading to the death of protestors. Elections in authoritarian regimes tend to have no political strength or purpose as authoritarian leaders control elections to maintain power, and the recent elections in 2024 are just another example of how the Venezuelan dictatorship has evaded losing its power. Moreover, when the results of the election result were challenged, Maduro implemented further attacks on the Venezuelan people. Dozens were killed protesting the results, while thousands of others were jailed. During this time, the Maduro government even passed a new law to regulate NGOs as a means to prevent them from attacking the government or assisting the people of Venezuela. This accumulation of issues leads the country into further crises. Venezuela is among the top three countries in the world for the number of refugees, with approximately 6.2 million people having fled. Since December 2023, there have been about 7.2 million Venezuelans in the country that require humanitarian assistance. The government’s actions have created further issues through hyperinflation and corruption, as those in power follow the commands of Maduro and the armed forces. On average, about 2000 Venezuelans are leaving the country each day. Although it is one of the top-ranking countries for renewable freshwater resources, around 8 out of 10, Venezuelans did not have consistent access to clean drinking water or basic sanitation in 2019. 

The ones that have suffered the most have been the people of Venezuela. Their quality of life has increasingly deteriorated with each coming day, with little hope for improvement. With another Maduro presidency, the prospect of the Venezuelan people liberating themselves from his tyrannical regime seems to be unlikely. While several factors contribute to authoritarianism in the country, the story cannot be told without discussing its reliance on revenue from oil exports. This has been, and since Chavez assumed power, the Venezuelan regime’s ace in its deck of cards as China, the US, and Europe have shown it is one product most of the world cannot resist. The US and Europe have championed human rights within their own countries and spread such messages worldwide opposing what has been occurring over the past decades in Venezuela, yet they have looked the other way. It is becoming more apparent that if Venezuela continues exporting its oil around the world, we will continue to see the humanitarian crises in the country grow, along with attacks on human rights and freedoms by the Venezuelan regime.

Although it may seem difficult to remain optimistic about Venezuela’s future, one must believe that change will come. Some hope may appear with the recent comments of the new President of the United States, Donald Trump, who stated that the USA will likely stop buying oil from Venezuela. While the truth of this statement remains to be seen, it could motivate other countries to slowly turn their backs on Venezuelan oil. However, China will likely continue importing oil from Venezuela until the foreseeable future, given its lack of interest in the politics of its trading partners. It is difficult to believe that Venezuela can reverse its path towards increasing authoritarianism, especially with recent events. 

Nevertheless, as history has shown, authoritarian governments have ended one way or another. Such as the death of Francisco Franco in Spain, which saw a transition to democracy and an end of the dictatorship after 26 years, or the fall of Fulgencio Batista in 1959 with the Cuban Revolution. The only question is whether the Venezuelan Regime will fall soon or decades from now; time will tell.