Reasonably Optimistic No blood for oil? That doesn’t make sense for Venezuela.
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Jan 10, 2026 Venezuelan President Nicolás Maduro's capture sparked protests and revived the 'no blood for oil' slogan. The podcast explores Venezuela's complex oil history, including the resource curse and the impact of oil price cycles on politics. It delves into Hugo Chavez's regime, highlighting the consequences of purges at PDVSA and lost expertise. The host argues that seizing Venezuelan oil would be economically irrational for the U.S., calling for a planned democratic transition and the necessary support to rebuild the country's oil capacity.
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Oil Motive No Longer Makes Strategic Sense
- U.S. seizure of Venezuelan oil would be strategically pointless in 2025 because America is no longer a net oil importer.
- Megan McArdle argues modern market dynamics reverse the old 'no blood for oil' logic and make taking oil counterproductive.
Why Oil Can Hurt Development
- Oil wealth often damages broader economic development by crowding out other industries and encouraging rent-seeking.
- Venezuela's heavy, sulfurous crude also raises extraction and refining costs, worsening long-term prospects.
Personal Memory Of Gas Rationing
- Megan McArdle recalls sitting in a car during U.S. gas rationing and waiting two hours to refuel with her parents.
- The memory illustrates how high prices alter consumer behavior and spur supply responses.