By Niall Clements, Amal Mansoor, Smaragda Vasileiadi, Francesca Bottan, Beline Nyangi, Dereje Daniel and Togo Yasuda Edited and reviewed by Beline Nyangi and Francesca Bottan.
Introduction
Venezuela and Iran occupy central positions in global energy politics due to their vast oil reserves, making them strategic points of interest for the United States. Historically, U.S. oil companies dominated production in both countries. Nationalization efforts, Venezuela in 1976 and Iran in 1951, triggered long-term geopolitical consequences, including sanctions and interventions. Today, U.S. actions in these countries, from sanctions to military operations, are officially framed around security, democracy and regional stability. However, the overlap between these objectives and the control of energy resources raises critical questions about the role of oil in shaping U.S. policy.
This paper examines the extent to which U.S. interventions in Venezuela and Iran fall under the scope of oil politics. It is expected that oil interests play a central but not exclusive role. Economic and strategic energy concerns are most visible in sanctions and market management, while military actions appear more strongly justified by security narratives. Overall, the analysis anticipates a dual logic: oil politics underpin U.S. engagement, but they operate alongside broader security and political considerations.
Iran and Venezuela are selected as comparative cases because both possess significant oil reserves and have been subject to sustained U.S. intervention, yet differ in regional context and strategic importance. This allows for a structured comparison that helps identify whether oil influences policy in consistent ways or varies depending on geopolitical conditions.
This paper adopts a structured analytical framework to distinguish between oil-driven and security-driven explanations of U.S. policy. Oil politics is defined as efforts to influence access to energy resources, control supply, or shape global oil markets. Security motivations refer to actions aimed at addressing perceived threats such as nuclear proliferation, regional instability or geopolitical rivalry. If oil were the primary driver of intervention, we would expect consistent targeting of energy infrastructure, direct attempts to control production, or policies designed to reshape global supply. If security concerns were dominant, interventions would occur regardless of energy considerations and would primarily focus on political or military objectives. By comparing these expectations with observed policies in Iran and Venezuela, the paper evaluates the extent to which oil interests shape U.S. intervention. This approach draws loosely on realist assumptions in international relations, which emphasise security and strategic competition, as well as political economy perspectives that highlight the role of material resources and financial structures in shaping state behaviour. The analysis does not treat these as competing theories but instead examines how they interact in practice.
Rather than treating oil and security as competing explanations, this paper argues that they operate at different levels. Oil interests are most visible in economic instruments such as sanctions, while military and diplomatic interventions are more directly shaped by security narratives. This distinction allows for a more precise understanding of how energy and geopolitics interact in contemporary U.S. foreign policy.
Oil reserves and Ownership
Venezuela and Iran are central to global energy politics due to their vast oil reserves. Venezuela holds the largest proven reserves in the world, particularly of heavy crude in the Orinoco Belt, while Iran ranks among the top producers globally (Power, 2026; OPEC, 2007). These resource endowments place both countries in strategically significant positions within global energy markets, making them relevant not only as producers but also as potential sources of geopolitical leverage.
Historically, U.S. oil companies played a dominant role in both countries. In Venezuela, firms such as ExxonMobil, Conoco and Chevron controlled a majority of production, particularly during the early twentieth century (Macbeth, 1983). This dominance was reinforced by early investment and infrastructure development, including refineries tailored to Venezuelan crude (Power, 2026). In Iran, foreign control was institutionalised through the 1954 Consortium Agreement, which granted Western companies significant authority over production and pricing, with American firms alone holding 40 percent of shares (Ashayeri, 2025).
Nationalisation marked a turning point in both cases. Venezuela nationalised its oil industry in 1976, establishing PDVSA and asserting state control over resources (Shamim, 2025). Similarly, Iran nationalised its oil industry in 1951 under Mohammad Mossadegh, seeking greater revenue and sovereignty (Mafi, 2008). These actions fundamentally altered the relationship between resource-rich states and foreign capital, reducing direct external control over oil production and revenues.
The geopolitical consequences of nationalisation were significant. In Iran, it contributed to sustained external pressure, including sanctions and intervention, as foreign powers sought to reassert influence (Shamim, 2026). In Venezuela, nationalisation reshaped relations with international oil companies and shifted the balance of power toward the state, while also creating long-term tensions with foreign investors (Kimball, 2026).
From an analytical perspective, these developments highlight the structural importance of oil in shaping relations between the United States and both countries. Control over oil resources has historically been linked to broader questions of sovereignty, economic independence and external influence. However, the presence of large reserves alone does not fully explain the timing or form of U.S. intervention. Many resource-rich states do not experience similar levels of sustained pressure or involvement. This suggests that while oil is a necessary background condition for understanding these relationships, it is not sufficient on its own to account for specific policy choices.
Overall, oil reserves and ownership structures establish the underlying context within which U.S. policy operates, but they do not by themselves determine the nature of intervention. Instead, they interact with political, economic and strategic factors that shape how and when the United States engages with these states.
This paper adopts a structured analytical framework to distinguish between oil-driven and security-driven explanations of United States policy. Oil politics is defined as efforts to influence access to energy resources, control supply, or shape global oil markets. Security motivations refer to actions aimed at addressing perceived threats such as nuclear proliferation, regional instability, or geopolitical rivalry. If oil were the primary driver of intervention, we would expect consistent targeting of energy infrastructure, direct attempts to control production, or policies designed to reshape global supply. If security concerns were dominant, interventions would occur regardless of energy considerations and would primarily focus on political or military objectives. By comparing these expectations with observed policies in Iran and Venezuela, the paper evaluates the extent to which oil interests shape United States intervention.
Iran and Venezuela are selected as comparative cases because both possess significant oil reserves and have been subject to sustained United States intervention, yet differ in regional context and strategic importance. This allows for a structured comparison that helps identify whether oil influences policy in consistent ways or varies depending on geopolitical conditions.
Rather than treating oil and security as competing explanations, this paper argues that they operate at different levels: oil interests are most visible in economic instruments such as sanctions, while military and diplomatic interventions are more directly shaped by security narratives.
OPEC and the Global Oil Market
The global oil market operates as a system of production, trade and pricing shaped by both state and market actors. The Organization of the Petroleum Exporting Countries (OPEC), founded in 1960 by Iran, Iraq, Kuwait, Saudi Arabia and Venezuela, plays a central role in coordinating supply and influencing prices. Within OPEC, production capacity varies significantly. While Venezuela holds the largest proven reserves, much of it consists of heavy crude that requires specialised extraction and refining technology. Saudi Arabia remains the largest producer within the organisation, while Iran’s output has fluctuated due to external constraints, particularly sanctions.
Beyond production, the structure of global oil trade is heavily influenced by financial systems. Oil transactions are predominantly conducted in U.S. dollars, a system often referred to as the petrodollar system. Established through agreements between the United States and Saudi Arabia in the 1970s, this arrangement reinforces the centrality of the dollar in global energy markets. As a result, countries must maintain access to dollar reserves and financial clearing systems in order to participate fully in oil trade. This creates a form of indirect influence, as the United States can leverage its position within global financial networks to shape market participation.
This financial dimension is particularly significant in the context of sanctions. By restricting access to dollar-based transactions and financial institutions, the United States can limit the ability of countries such as Iran and Venezuela to export oil, even without direct control over physical production. While alternative arrangements have emerged, including transactions in currencies such as the Chinese yuan or Russian ruble, these remain partial workarounds rather than full substitutes. By 2023, approximately one fifth of global oil trade was conducted in non-dollar currencies, indicating some diversification but not a fundamental shift away from dollar dominance.
These dynamics highlight that influence in the oil market extends beyond ownership of reserves or production capacity. Control over financial infrastructure and trade mechanisms can be equally important in shaping global supply and pricing. This helps explain why the United States continues to exert significant influence over global energy markets despite changes in production patterns and the rise of other major producers.
At the same time, this system is not absolute. The emergence of alternative trading arrangements and the ability of sanctioned states to find new buyers demonstrate that U.S. influence has limits. Countries such as Iran and Venezuela have continued to export oil through indirect channels, reducing but not eliminating the impact of financial restrictions.
Overall, the structure of the global oil market suggests that U.S. power operates primarily through indirect mechanisms, particularly financial control and market access. This supports the argument that oil politics is not limited to physical resource control, but also includes the ability to shape the conditions under which oil is traded.
Oil Politics and the Strait of Hormuz
The Strait of Hormuz is one of the most critical chokepoints in the global energy system, linking oil producers in the Gulf to international markets. A significant share of the world’s traded oil and liquefied natural gas passes through this narrow route, making it indispensable to both producers and consumers. This concentration of supply creates a structural vulnerability, as disruptions in the Strait can have immediate and far-reaching effects on global prices, supply stability and economic security.
From an oil politics perspective, this vulnerability increases the geopolitical importance of the region. Control over, or disruption of, such a key transit route provides states with leverage that extends beyond their domestic production capacity. Iran’s geographic position allows it to threaten or restrict access to the Strait, turning it into a strategic bargaining tool in response to external pressure, particularly sanctions. Episodes of heightened tension have demonstrated how even the possibility of disruption can generate volatility in global energy markets.
However, the significance of the Strait also highlights the limits of interpreting these dynamics purely through oil. While disruptions affect global supply, responses by the United States are consistently framed in terms of security, deterrence and regional stability. Ensuring freedom of navigation, protecting allies and preventing escalation are presented as primary objectives. This suggests that although oil is central to the strategic importance of the Strait, it is embedded within a broader security framework rather than acting as an independent driver of policy.
The interaction between sanctions and maritime security further illustrates this dual dynamic. Measures targeting Iran’s oil exports reduce its economic capacity, while tensions in the Strait create the risk of retaliatory disruption. In this context, oil functions both as an economic resource and as a strategic instrument. Yet, despite significant economic pressure, Iran has not fundamentally altered key aspects of its regional or nuclear policy, indicating the limits of oil-based coercion.
From a United States perspective, policies toward Iran are formally justified through concerns about nuclear proliferation and regional destabilisation. Efforts to restrict oil revenues are framed as a means of limiting the financial resources available for these activities. At the same time, reducing Iranian exports has the effect of influencing global supply, demonstrating how economic and security objectives can overlap in practice.
Overall, the Strait of Hormuz illustrates that oil and security considerations are deeply intertwined. Oil explains the strategic importance of the region, while security concerns shape how states respond to that importance. This supports the broader argument that oil does not operate as a standalone cause of intervention, but rather as a factor embedded within wider geopolitical calculations.
US Sunction and Oil Strategy
U.S. sanctions represent one of the most significant tools through which oil-related interests intersect with foreign policy in both Iran and Venezuela. Officially, these measures are framed as instruments of political pressure, aimed at influencing behaviour, limiting security threats and promoting political change. In practice, however, they operate directly on the oil sector, targeting production, exports and revenue streams that are central to both economies.
In Iran, sanctions have been justified as part of a broader “maximum pressure” campaign designed to restrict the financial resources available for nuclear development, military activity and regional influence. Because Iran relies heavily on oil exports for foreign currency earnings, these measures have had substantial economic effects, reducing state revenues and constraining economic activity. At the same time, they have removed significant volumes of oil from global markets, particularly following the reimposition of sanctions in 2018, when exports declined sharply.
A similar pattern is visible in Venezuela. Sanctions targeting PDVSA, the state oil company, restricted access to key markets and limited the country’s ability to sustain production, particularly given its dependence on imported inputs such as diluents for processing heavy crude. These measures contributed to a significant decline in oil output and export capacity, further deepening the country’s economic crisis.
The effectiveness of sanctions is reinforced by the structure of the global financial system. Because most oil transactions are conducted in U.S. dollars and cleared through U.S.-regulated institutions, restricting access to these systems limits a country’s ability to participate in global trade. As a result, both Iran and Venezuela have increasingly turned to alternative arrangements, including transactions in non-dollar currencies and the use of indirect shipping networks. While these strategies have allowed for partial adaptation, they have not fully offset the impact of sanctions.
Evaluated against their stated political objectives, sanctions show mixed results. In Iran, they have not resulted in a fundamental shift in nuclear or regional policy. In Venezuela, they have not produced a decisive transition in political leadership or governance. Both countries have demonstrated resilience and have developed mechanisms to mitigate some of the pressure imposed on their economies.
However, sanctions have produced more consistent effects in the economic and energy domains. They have reduced state revenues, constrained production capacity and removed significant volumes of oil from global markets. The scale of this disruption is comparable to major production adjustments within OPEC, highlighting the extent to which sanctions function as instruments that reshape global supply.
This gap between limited political success and clear market impact is analytically significant. It suggests that while sanctions are presented primarily as tools of political pressure, they also operate as mechanisms that influence global energy dynamics. Whether intentional or not, the removal of oil from the market can benefit alternative producers and alter pricing structures.
Overall, sanctions provide the strongest evidence that oil plays a central role in U.S. policy, particularly at the economic level. They demonstrate how energy considerations are embedded within broader strategic actions, even when official justifications emphasize security or political objectives. This reinforces the argument that oil does not act as a sole driver of intervention, but it significantly shapes how policy is implemented and what its consequences are.
Foreign Involvement
Foreign involvement has played a central role in shaping the oil sectors of both Venezuela and Iran, with long-term effects on their political systems, economies and positions in the global energy market. In both cases, external actors, particularly the United States and Western oil companies, have influenced how oil resources are controlled, produced and distributed. This has created persistent tensions between national sovereignty and external economic interests.
In Venezuela, foreign involvement was initially characterised by the dominance of U.S. oil companies. Firms such as ExxonMobil, Conoco and Chevron controlled a large share of production, supported by early investment and concession agreements following the discovery of major reserves in the early twentieth century (Macbeth, 1983). This relationship was reinforced by infrastructure tailored to Venezuelan heavy crude and close economic ties with the United States (Power, 2026). The nationalisation of the oil industry in 1976 marked a significant shift, transferring control to the state through PDVSA and reducing direct foreign influence (Shamim, 2025).
More recent forms of foreign involvement have been shaped primarily by sanctions and political pressure. Measures targeting the oil sector have restricted Venezuela’s ability to export crude and access essential inputs, contributing to declining production and broader economic instability. In response, the government has sought alternative partnerships and financial arrangements to sustain exports. These developments illustrate how external pressure continues to shape the functioning of the oil sector, even in the absence of direct foreign ownership.
In Iran, foreign involvement followed a similar trajectory, although shaped by different historical dynamics. Western influence over the oil sector was formalised through agreements that granted foreign companies significant control over production and pricing (Ashayeri, 2025). The nationalisation of oil in 1951 represented an attempt to reassert sovereignty and increase state control over revenues (Mafi, 2008). As in Venezuela, this shift was followed by sustained external pressure, including sanctions that targeted the country’s economic and energy sectors.
In the contemporary period, sanctions have become the primary mechanism of foreign involvement in Iran. These measures have reduced oil exports, limited access to global financial systems and constrained economic activity. At the same time, Iran has developed alternative strategies, including indirect trade networks and new buyers, which have partially mitigated these effects. This reflects a pattern also observed in Venezuela, where external pressure reshapes rather than fully determines the operation of the oil sector.
At a broader level, foreign involvement in both cases has had measurable effects on global oil markets. Sanctions and political tensions have reduced supply and contributed to market volatility. These disruptions demonstrate how external intervention in oil-producing states can have consequences that extend beyond domestic contexts and affect global energy dynamics.
Overall, foreign involvement highlights the continuing importance of oil in shaping relationships between states. However, its role is mediated by political and strategic considerations. External actors do not simply seek control over resources, but rather influence the conditions under which those resources are produced and traded. This supports the argument that oil remains central to economic strategy, while operating alongside broader geopolitical objectives.
US Intervention
United States interventions in Venezuela and Iran have taken different forms, ranging from sanctions and diplomatic pressure to limited military actions and strategic signalling. In both cases, official justifications emphasise security concerns, including political instability, nuclear proliferation, terrorism and regional balance of power. However, underlying these narratives are consistent concerns about geopolitical influence and energy security.
In Venezuela, the political and economic crisis has been accompanied by increasing external involvement. The government’s gradual consolidation of power under Hugo Chávez and later Nicolás Maduro was followed by institutional weakening and democratic backsliding. Economic decline was driven by a combination of mismanagement, currency controls, falling oil prices and external sanctions. Given that oil represents the central source of national revenue, restrictions on the oil sector have had far-reaching consequences for state capacity and social stability.
United States involvement has primarily taken the form of sanctions and targeted legal and economic pressure against the Venezuelan state and its oil company PDVSA. These measures have significantly reduced export capacity and restricted access to international markets. Officially, they are justified as responses to democratic erosion, corruption and human rights concerns. However, their direct impact on oil production and exports means they also reshape global energy flows. This dual effect reflects the overlap between political objectives and energy market consequences.
In Iran, United States intervention has similarly combined security framing with economic pressure. Actions have been justified through concerns about nuclear development, regional instability and support for proxy groups. Sanctions targeting the oil sector have played a central role in this strategy, significantly reducing export revenues and limiting access to global financial systems. Although framed as tools of coercive diplomacy, these measures also influence global oil supply and pricing.
While there have been instances of military escalation and strategic pressure, including strikes on infrastructure and targeted operations, these actions are officially framed within a security rationale rather than resource control. The United States consistently presents its involvement as necessary to prevent escalation and maintain regional stability. This suggests that military intervention is more strongly shaped by security considerations than by direct attempts to control oil resources.
The role of third parties, particularly Israel in relation to Iran, further reinforces the security dimension of U.S. policy. Israeli concerns regarding Iran’s nuclear program contribute to broader regional pressure, aligning with United States strategic interests. However, while these alliances influence policy direction, they do not fully explain the consistent focus on energy infrastructure and export capacity within sanctions regimes.
At the international level, the legality of certain interventions remains contested, particularly where actions occur without explicit United Nations Security Council authorisation. However, the legal debate, while important, is secondary to the structural observation that most policy tools employed in both cases have direct or indirect effects on oil production and distribution.
Overall, United States intervention in Venezuela and Iran reflects a layered logic. Security concerns provide the primary public justification, while economic instruments such as sanctions produce significant effects on oil markets. This indicates that oil is not typically the stated driver of intervention, but it is a consistent and meaningful factor shaping both the tools used and their consequences.
Conclusion
The analysis demonstrates that United States interventions in Venezuela and Iran are shaped by a combination of security concerns and energy-related considerations, but these factors operate in different ways depending on the policy instrument used. Rather than being driven by a single motive, U.S. foreign policy reflects a layered logic in which oil and security are closely interconnected but not interchangeable explanations.
Oil plays its most significant role in the use of economic tools, particularly sanctions. In both Iran and Venezuela, measures targeting oil production, exports and financial access have had measurable effects on state revenues and global supply. These outcomes suggest that energy considerations are deeply embedded in the structure and consequences of U.S. economic policy, even when not explicitly stated as the primary objective.
In contrast, military and strategic interventions are more consistently justified through security narratives, including nuclear non-proliferation, regional stability and counterterrorism. In these cases, oil does not appear to be the direct driver of action, although it remains part of the broader strategic environment within which decisions are made.
The comparison of Iran and Venezuela therefore supports a differentiated interpretation of oil politics. Oil is not sufficient to explain why intervention occurs, but it is crucial in shaping how intervention is conducted and what its effects are. In particular, the ability to influence oil flows through sanctions and financial restrictions demonstrates a form of indirect power that operates alongside traditional security objectives.
Ultimately, United States policy reflects an interaction between material interests and strategic concerns. Oil functions as a structural factor that shapes incentives, tools and consequences, while security narratives provide the official framework through which actions are justified. Understanding this interaction is essential for explaining the complexity of contemporary intervention in major energy-producing states.
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