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U.S. Partner in Venezuela Oil Deal Looks to Hike Crude Production
Colombia’s largely untapped critical mineral…
Politics, Geopolitics & Conflict
On October 13, Ukrainian drones began falling out of the sky after SpaceX imposed new restrictions on the satellite connections that control them. Some lost contact with their operators when they reached 90 km/hour; others had to fly slowly enough to remain connected, making them easier targets for Russian air defenses. Ukraine also lost the ability to use some of its interceptor drones against Russian attacks. CBS News and the Wall Street Journal claim Musk personally ordered the restrictions, while Reuters cited officials saying that was on Washington’s orders. This is an extraordinary problem when a private company can disable any part of a sovereign ally’s military capabilities during a war. Governments have allowed Musk to accumulate extraordinary power by outsourcing critical infrastructure to companies they can no longer easily replace. SpaceX now operates a satellite network on which militaries, intelligence services and civilian populations depend, and governments paying for its services do not necessarily control how they are delivered. Decisions affecting a country's ability to defend itself can be made by a private businessman who answers to shareholders and contracts rather than the elected government or military command. As Starlink becomes embedded in national communications and defense systems worldwide, the question of who ultimately controls that infrastructure becomes a question of national sovereignty.
Politics, Geopolitics & Conflict
On October 13, Ukrainian drones began falling out of the sky after SpaceX imposed new restrictions on the satellite connections that control them. Some lost contact with their operators when they reached 90 km/hour; others had to fly slowly enough to remain connected, making them easier targets for Russian air defenses. Ukraine also lost the ability to use some of its interceptor drones against Russian attacks. CBS News and the Wall Street Journal claim Musk personally ordered the restrictions, while Reuters cited officials saying that was on Washington’s orders. This is an extraordinary problem when a private company can disable any part of a sovereign ally’s military capabilities during a war. Governments have allowed Musk to accumulate extraordinary power by outsourcing critical infrastructure to companies they can no longer easily replace. SpaceX now operates a satellite network on which militaries, intelligence services and civilian populations depend, and governments paying for its services do not necessarily control how they are delivered. Decisions affecting a country's ability to defend itself can be made by a private businessman who answers to shareholders and contracts rather than the elected government or military command. As Starlink becomes embedded in national communications and defense systems worldwide, the question of who ultimately controls that infrastructure becomes a question of national sovereignty.
Brazil’s October 25 presidential runoff could bring Latin America’s largest country into Trump’s expanding regional security alliance. Bolsonaro, who took 47% of the first-round vote against incumbent Lula’s 45%, has promised to join the U.S.-led Shield of the Americas, which combines military and intelligence cooperation against drug cartels with Washington’s efforts to limit Chinese influence in the region. Washington is already pressing Brazil for greater access to its critical minerals and rare earths, while China remains Brazil’s largest trading partner.
Global investment firms managing a combined $5.8 trillion have opened or committed to opening their first Gulf offices since the US-Iran war, with Abu Dhabi attracting the lion’s share. Nearly 20 firms overseeing more than $5 trillion have chosen Abu Dhabi, compared with 10 managers controlling $670 billion in Dubai. The attraction is largely the region's sovereign wealth funds, particularly in Abu Dhabi, where Mubadala has become the world's most active sovereign investor this year. Riyadh has attracted just two first-time entrants since February, while Doha has secured one.
Trump’s claim that his Venezuelan oil deal gives the US control over 65 billion barrels of proven reserves remains a point of contention. Energy experts estimate the recoverable volume could be a fraction of that figure. Venezuela claims the world’s largest proven reserves at 303.7 billion barrels, but independent estimates put the credible figure at just 60 billion to 120 billion, with inflated numbers dating back to Chávez, whose government reclassified vast quantities of heavy oil in the Orinoco Belt without independent certification. Trump’s deal covers 17 fields supposedly containing 65 billion barrels, but former Citgo chair Luisa Palacios estimates that as little as 3.2 billion barrels may actually qualify as proven reserves, while Rice University’s Francisco Monaldi puts the near-term figure at 10 billion to 15 billion.
Iraq has signed an MoU with ExxonMobil to develop a seawater injection project capable of supplying 2.5 million barrels of water daily to its southern oilfields. The agreement with state-owned Basra Oil Company covers the second phase of Iraq’s seawater development program and complements a separate 5 million barrel-per-day project being developed by TotalEnergies. Together, the projects would provide 7.5 million barrels of daily water injection capacity to maintain reservoir pressure, sustain production at Iraq’s aging southern fields and support future output increases. The agreement also adds to ExxonMobil’s expanding discussions with Baghdad over the Majnoon oilfield and export infrastructure, while Chevron is negotiating opportunities at West Qurna 2 and Nasiriyah.
Saudi Aramco is negotiating access to foreign governments’ strategic oil storage as Houthi attacks threaten Saudi Arabia’s ability to maintain exports. CEO Amin Nasser said Thursday that Aramco wants to double its overseas storage capacity, expanding beyond its existing facilities in South Korea, Japan, the Netherlands and Egypt’s Mediterranean terminal at Sidi Kerir. Government-owned reserves offer considerably more capacity than commercial storage, allowing Aramco to keep crude closer to its customers when attacks interrupt Saudi export routes.
Abu Dhabi’s ADNOC is reportedly in preliminary talks through its international investment arm XRG to acquire a stake in Eni’s Libyan oil and gas business. Eni has operated in Libya since 1959 and currently produces around 162,000 boepd there, accounting for roughly 10% of its global output. For XRG, the investment would provide additional production outside the Gulf as the Iran war increases the risks surrounding regional energy exports. (The two companies already work together on an LNG project in Argentina with YPF). Neither company has commented to the media.
Kinder Morgan has approved $4.7 billion in investments in two major U.S. natural gas pipeline projects, bringing its total development backlog to a record $14.4 billion. The company will invest $3.1 billion in the 470-mile Southeast Connector (which delivers 2.6 billion cubic feet per day to power markets in the U.S. Southeast), and $1.6 billion in the 434-mile Permian Link, which will move another 2.8 billion cubic feet daily from West Texas toward the Midcontinent. Permian Link is scheduled to begin operating in the third quarter of 2030, followed by the Southeast Connector later that year. Kinder Morgan now has $13.2 billion in natural gas projects under development.
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