Michael Burry, a well-known short-selling investor known as "The Big Short," pointed out that Russia's global standing may be weakened as the Maduro government in Venezuela collapses under US military intervention.
The United States launched a surprise military operation last Saturday, invading Venezuela and arresting the country's president, Maduro, and his wife.
Burry wrote on the content publishing platform Substack that Russia may face a chain reaction after the US overthrows the Maduro government.
Shortly after Maduro's arrest, US President Trump stated that the United States would become more involved in the oil-rich country. Trump delegated the responsibility for improving Venezuela's oil infrastructure to US oil companies, demanding billions of dollars in investment and claiming that the US would sell the oil to other countries.
According to Bury's estimates, although this process may take five to seven years, once Venezuelan oil supplies increase, it could weaken Russia's revenue and influence.
“In the medium and long term, Russian oil is no longer as important,” Bury wrote.
“As the United States brings large oil companies into Venezuela and acquires relatively close refining assets, global energy geopolitics will shift,” he said.
Russia is the world's largest oil exporter and the second-largest crude oil exporter after Saudi Arabia. Oil taxes are a significant source of revenue for Russia.
According to data from the Energy Institute, Venezuela possesses approximately 19% of the world's oil reserves, or about 300 billion barrels, far exceeding the United States' 61 billion barrels.
However, due to outdated infrastructure, mismanagement, and US sanctions, Venezuela's actual output is only a small fraction of its potential capacity.
Alexander , Vice President of Boston College and an economist Tomic stated that given Venezuela possesses the world's largest oil reserves, any increase in its production could potentially impact oil prices globally.
He said that if oil prices fall due to Venezuela increasing global supply, Russia could be weakened because oil is Russia's "lifeline".
Despite facing US sanctions, Russia continues to export oil to countries such as India.
Tomic added that if Venezuela's increased production causes oil prices to fall, Russia could lose more than any other country because it is engaged in a costly war in Ukraine.
According to data from the Oxford Energy Institute, oil and gas The industry accounts for approximately 20% of Russia's GDP on average.
However, Tomic also stated that it remains to be seen whether American oil companies will quickly return to Venezuela.
ConocoPhillips and ExxonMobil Chevron withdrew from the country in the early 21st century and subsequently sought compensation for losses of its expropriated assets through international arbitration. It is currently the only American oil company still operating in Venezuela.
Tomic also pointed out that increased Venezuelan production could depress oil prices, which would also impact the profits of US oil companies.
(Article source: CLS)
