The American president Trump announced he will act “very soon” on the ground against “drug traffickers from Venezuela”. Link to Diário de Notícias here.
No details are known yet — will it be a small ground operation? A larger-scale operation? In the long term, do they intend to support a coup d’état and overthrow Nicolás Maduro?
I will focus on the global-scale impacts:
Likely Global-Scale Impacts — The Real Motives
Several airlines have already cancelled flights to Venezuela.
Venezuela still has significant reserves of heavy oil — and part of its output, although smaller than at its peak, continues to be exported.
Geopolitical conflicts generally generate a “risk premium” in oil markets: in cases of war, sanctions, supply disruption, or fear of transportation/extraction issues, investors anticipate possible shortages and raise crude prices.
As a consequence of rising crude oil prices, the cost of fuels and derivatives also increases.
Europe as a whole (and Portugal with it) imports oil from dozens of countries. A crisis in a major global supplier can increase international prices and influence domestic prices.
Furthermore, geopolitical uncertainty usually shakes global stock markets: investors tend to flee risk assets (stocks) and seek safer investments or rebalance portfolios, which may generate drops in international stock indexes — especially if the conflict threatens global energy supply and affects production costs.
I feel that the interest is monetary (it has nothing to do with drug trafficking), and indeed the value of the dollar is linked to oil trading.
Venezuela holds some of the largest heavy crude reserves in the world — although its current production is far below historical potential. It is estimated to produce around 1–1.1 million barrels per day today.
If Donald Trump argues that the motive for this intervention is fighting drug trafficking, then why doesn’t he carry out the same military intervention in Mexico?
Mexico vs Venezuela
Mexico shares a border with the US; in addition, most of the drugs entering the country come from there.
If the US intervened militarily in Mexico (a neighbouring country), there would be chaos and massive migration of people into the US.
Economically, a destabilized Mexico would be terrible for the US — many American industries depend on Mexican manufacturing and imports. Therefore, a heavy-handed military approach against Mexico would come at a very high cost.
Mexico, if the Americans intervened militarily, would be a difficult, controversial, and internationally criticised target. The political, strategic, economic and international-legitimacy costs of intervening in such a closely integrated ally would be enormous.
Mexico is a country with too many strategic, economic and social ties to the US. Invading or intervening militarily in Mexico would represent a huge risk for American interests.
Venezuela, on the other hand, is a more “accessible” target, with an internationally isolated regime, institutional and economic crisis, and tense geopolitical relations with several countries.
In Venezuela’s case, the combination of allegations of narco-terrorism, diplomatic isolation of the regime, and lower interdependence with the US makes an intervention comparatively “easier” and less contested.
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