The Petrodollar War: Why Venezuela Was Never About Drugs, Terrorism, or Democracy
By Keji-Keji Mayomism, Darwin, Northern Territory, Australia
Tuesday, 13 January 2026 (PW) — The real reason the United States is moving against Venezuela has nothing to do with drugs, terrorism, or democracy. It traces back to a quiet but world-shaping agreement made in 1974—one that underpins the survival of the U.S. dollar itself.
At stake is the petrodollar system, the foundation of American economic dominance for the last half-century. And Venezuela, sitting atop the largest proven oil reserves on Earth, has become a direct threat to that system.
Venezuela’s Oil and Why It Matters
Venezuela holds approximately 303 billion barrels of proven oil reserves—more than Saudi Arabia and roughly 20 per cent of global reserves. This alone makes it strategically critical. But oil volume is not the real issue.
The problem is how Venezuela chose to sell its oil.
Beginning in 2018, Caracas publicly announced its intention to “free itself from the dollar.” It began accepting payment in Chinese yuan, euros, and rubles, explicitly rejecting U.S. dollars. Venezuela pursued BRICS membership, established direct payment channels with China, and sought alternatives to SWIFT, the Western-controlled global payment system.
With decades of oil revenue potentially flowing outside the dollar system, Venezuela represented something far more dangerous than a hostile government: a working model for large-scale de-dollarisation.
The Petrodollar Explained
In 1974, following the collapse of the Bretton Woods system, the United States struck a pivotal deal with Saudi Arabia. Under this agreement:
• All global oil sales would be priced in U.S. dollars
• In return, the United States would provide military protection
This arrangement created permanent, artificial demand for dollars. Every country on Earth needed U.S. currency to buy oil. The result was unprecedented monetary privilege: the United States could print money at will, while the rest of the world had to earn it.
This system funds U.S. deficit spending, sustains its military reach, and underwrites its global influence. In practical terms, the petrodollar has been more critical to American hegemony than aircraft carriers or nuclear weapons.
What Happens to Those Who Challenge It
There is a clear historical pattern.
• 2000: Iraq announces it will sell oil in euros.
• 2003: Iraq is invaded. The euro policy ends immediately. No weapons of mass destruction have ever been found.
• 2009: Libya proposes a gold-backed African currency, the “gold dinar”, to be used for oil trade.
• 2011: NATO bombs Libya. The proposal disappears along with its leader. Libya collapses into chaos.
Now consider Venezuela.
It holds more oil than Iraq and Libya combined, was already selling oil in yuan, was building non-dollar payment systems, was aligning with China, Russia, and Iran, and was seeking BRICS membership. These are the same states leading the global push away from dollar dependence.
This is not a coincidence. It is precedent.
The Strategic Admission
Recent U.S. statements have been unusually candid. American officials have openly argued that Venezuela’s oil “belongs” to the United States because U.S. companies helped develop it decades ago. By this logic, any nationalised resource anywhere in the world is theft.
But the deeper issue is unavoidable: the petrodollar is already weakening.
• Russia now sells energy in rubles and yuan
• Iran has traded outside the dollar for years
• Saudi Arabia is openly discussing yuan settlements
• China has built CIPS, an alternative to SWIFT operating in 185 countries
• BRICS nations are developing direct settlement systems like mBridge
If Venezuela, with its immense oil reserves, were fully integrated into this ecosystem, it would accelerate de-dollarisation dramatically.
Why the Official Narrative Fails
The public justifications collapse under scrutiny.
• Drugs: Venezuela accounts for less than one per cent of the U.S. cocaine supply.
• Terrorism: There is no credible evidence that Venezuela operates a terrorist network targeting the United States.
• Democracy: The U.S. maintains close alliances with absolute monarchies that hold no elections at all.
The explanation is not moral. It is monetary.
The Risk Washington Is Taking
Russia, China, and Iran have already condemned the intervention as armed aggression. China, Venezuela’s largest oil customer, stands to lose billions of dollars. Every nation contemplating de-dollarisation is watching closely.
The intended message is clear: challenge the dollar and face force.
But that message may backfire.
For many countries in the Global South, the lesson is not submission—it is urgency. If threatening dollar dominance invites intervention, the only real protection is to move faster, together, and irreversibly.
A Familiar Playbook
The symbolism is striking.
• January 3, 1990: Panama is invaded. Its leader is captured under the pretext of drug trafficking.
• January 3, 2026: Venezuela is invaded. Its leader is captured under a similar narrative.
Same justification. Same strategy. Same underlying motive: control of strategic resources and trade systems.
History does not repeat, but it does rhyme.
The Question No One Is Asking
What happens when military force is no longer enough to enforce currency dominance?
What happens when economic retaliation becomes possible?
What happens when a multipolar world decides that monetary coercion is unacceptable?
When a nation must bomb others to keep them using its currency, that currency is no longer winning on trust, stability, or merit. It is being enforced.
Venezuela is not the beginning of this story.
It looks far more like the desperate end.
The writer, Keji-Keji Mayomism, is a Sudo-Aussie National living in Darwin, Northern Territory, Australia and can be reached via his email: Keji Keji <[email protected]>
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