Venzuela’s oil is heavy, dirty with high sulfur. The USA’s Bakken oil is light, sweet, low sulfur and holds more than ten times the proven reserves of Saudi Arabia’s.
Heavy oil is viscous and tarry, difficult to pump and clean up after. Most pipelines won’t accept heavy high crude unless it’s first blended with other oils and still the pipelines shun it because of the buildup inside the pipes that creates a maintenance nightmare.
Same with oil refineries, inject heavy crude into an oil refinery designed for lighter or blended crude and the refinery comes to a halt as the heavy crude renders pumps and valves inoperable.
Russians have the same problem with their crude. What the Russians have of value is natural gas. But the Russian supply of NG can be replaced. Obama should help facilitate a supply source replacement immediately for the Eurozone who have already requested the USA’s help in doing this. But Obama won’t do it because he and his people are corrupt and he will wait until the Eurozone offers enough compensation before he gets involved, and it may never happen.
Venezuela’s oil is also hard to get out of Venezuela. Oil tankers cannot sail into Maracaibo as the inlet is too shallow or narrow in parts. The closest a tanker can tie up is an international island terminal where the oil is brought by barge from Maracaibo.
And there is rampant corruption. Every little army officer has got his handout for a bribe or ‘fee’ and there is no end to it. Shipping insurance companies refuse to insure tankers so almost no registered and insurable oil tankers are found in Venezuelan territorial waters. Many oil buyers tell PDVSA (government oil company) to bring the oil to Houston and if it meets specs they’ll buy it.
The best the USA can do to snuff out socialists in Venezuela and to impede the Russians is to continue allowing the development of the Bakken Oil region, keep the US dollar strong by reducing spending, full stop on QE, prosecute banks that have avoided justice and make a deal with the Federal Reserve to destroy the debt it has monetized for the US government. Then there will be no crushing debt service as interest rates rise and there will be no deflationary collapse of the US Dollar. Hyperinflation can be held back by smart monetary policy. Invest in innovation and to boost GDP (the old formula) by more than 10% in one year pass the FairTax legislation HR 25 that presently has 75 sponsors in Congress supporting it.
American economic resurgence can lift the Eurozone and all the developed world with it. Then Putin’s autocratic Russia will return to their second to third world status because they lack the rule of law and infrastructure to honor contracts and allow markets to function.
I don’t look at Russia as a bear, I look at them as jackals. It is said when the lion leaves, the jackals move in. That is precisely what is happening on the world stage with Russia now.
One more note about Russia, three mafia like families control all the oil in Russia. Putin is part of one of them. They don’t like each other but for now they have a truce of sorts. Any of Putin’s bravado taken out of his lungs by calling his hand that leads to his embarrassment will see the other autocrats come down on him like a sledge hammer. Then the world can say goodbye to Putin. The departure of Putin will bring in another ruling family with similar ambitions, but in the transient period, fellows like Maduro will be taken down as they wander about aimlessly.
Short summary: Putin and Madero are not as strong as they would like people to think they are. But the incompetence of Obama and his people allows them to strut their machismo. They are more like paper tigers but the Russians do have nukes so they command some respect. If they ever mobilized to use nukes, the Russian people would likely come close to a civil war as they know the autocrats in the past have damaged Russia severely.