Caracas, Competition, Crusade: The Essequibo Crisis and its Multilateral Origins

As the Russian invasion of Ukraine nears its second year and a fresh war rages in Gaza, there exists a brewing conflict on the opposite end of the globe with untold consequences and next to no news coverage.

Venezuela (orange) seeks to control the territory and offshore oil fields of Essequibo (light green), currently part of Guyana (light and dark green).

Sparsely populated, a third Hindu, and nestled above Brazil, the peaceful nation of Guyana has found its oil-rich Essequibo region under threat from Venezuela, under the leadership of strongman Nicolas Maduro. On December third, Maduro’s government held a referendum over whether Essequibo should become a state of Venezuela and its people citizens and passed with 98% in favor. Dubious and fraud-infested as the results may be, the referendum’s results still fueled the Maduro government’s fire: Venezuelan state-owned oil and mining giants have been granted exploration and operating licenses as Maduro declared Essequibo a “Comprehensive Defense Operational Zone” for his military. On the opposite side of the border, Guyanese President Irfaan Ali has vowed to hold firm at all costs. Brazil has even deployed peacekeeping forces to its northern state of Roraima, which borders both Venezuela and Essequibo.

It is clear that conflict is brewing, and could boil over if a resolution isn’t found soon. But why does Venezuela even deem Essequibo worth fighting for?

With 128,000 inhabitants and a land area larger than Florida, Essequibo was added to the then-colony of British Guiana after 50 years of territorial dispute in 1899. Venezuela has laid claim to the land in the face of colonial foes since the mid-19th century, and sees Essequibo as part of their historical jurisdiction. The propaganda arm of Maduro’s PSUV party claims that Essequibo, also known as Guayana Esequiba, was taken from them by the British Empire when colonizing northern South America and the Caribbean. As Maduro himself said in a recent speech: “Our Guayana Esequiba has been de facto occupied by the British Empire and its heirs and they have destroyed the area.”

Essequibo is also a resource-rich region, with an active gold industry and recently-discovered oil reserves off its coast—an estimated 11 billion barrels according to Exxon. To Venezuela—and Maduro—Guayana Esequiba is both historical territory and an economic saving grace. Essequibo’s strong prospects could revitalize Venezuela’s stagnant economy and increase its leading proven oil reserves.

Yet in Essequibo Guyana has an equally important economic lifeline. Buoyed by the “world-class” drilling opportunities in the Stabroek and Kaieteur Blocks, the small South American nation could become a major global energy player overnight. Given the high projected rates of extraction from the waters off of Essequibo, analysts forecast that Guyana could become the world’s highest per-capita oil exporter by 2035 and evolve into “the next United Arab Emirates.”

Maduro, however, seems intent on claiming Essequibo’s offshore oil fields, and doing so with Vladimir Putin’s help. The Kremlin has long supported Maduro’s regime, allowing Venezuela to offload sanctioned oil, offering personal security against assassination attempts, and even floating the idea of sending Russian troops to Venezuela under the guise of reinforcing national security. Ultimately, Putin’s longstanding relationship with Maduro, coupled with his blatant disregard of international norms and rejection of liberal institutions, could add significant wind to Caracas’ sails in the Essequibo dispute.

To make matters worse, Maduro is left to act with no credible enforcement standing in his way. Although the United Nations’ International Court of Justice banned Venezuela from taking any action in the Essequibo region, Maduro dismissed the ruling and belittled their authority. The international organizations which are designed to ward off this sort of irredentism have had little effect.

Yet beyond historical and economic reasons, Maduro also holds an ulterior political motive. After ruling the petrostate for nearly a decade and overseeing one of the nation’s worst periods of famine and poverty, Maduro faces an American-mandated free election in 2024, in which, based on his track record, he is sure to face competition. But he has found himself a window of opportunity.

Confronted by wars in Gaza, Ukraine, and rising tensions with China, conflicts in the United States’ main foreign policy hotspots have aligned like the Sun and Earth at equinox. The world’s policemen are stretched too thin, with Washington committed to numerous allies across the globe. Maduro understands the window of opportunity this international strife has created, occurring perfectly before the pivotal 2024 election.

For Maduro, the crisis in Essequibo serves as a perfect distraction for his constituents from the misery of his tenure. Successfully annexing Essequibo could buoy his approval rating just enough to get him over the line for a new term. Indeed, he has capitalized on rising tensions in the region by beginning to strengthen his grip on power, arresting key opposition figures over charges of treason.

Despite its clear regional significance, though, the situation in Essequibo must be viewed as a product of a weak U.S. foreign policy and a case study for the waning effectiveness of international institutions.

In stark contrast with historical doctrines, the Biden administration’s Venezuela policy has noticeably softened, with a rollback of sanctions following a set of agreements signed in Barbados that—on paper—pave the way for a fair electoral process between Maduro’s PSUV and the opposing Unitary Platform. These lighter sanctions have proven to be a windfall for Maduro and his government, as they wee allowed to re-enter the global oil, gas, and minerals markets and potentially earn 10 billion dollars—ten percent of Venezuela’s GDP—in 6 months. And even if the Biden administration were to reimpose sanctions in response to the crisis, based off Caracas’ brazen aggression one can infer that it bets success—and even failure—in Essequibo will outweigh the negative effects of those sanctions.

Clearly, Maduro is willing to do anything—including stir up a conflict in Essequibo—to stay in power. Maduro’s recent irredentism toward Essequibo can be understood as a mixture of a need for an economic lifeline and a PR boon ahead of the election. But would he be as aggressive toward Guyana if his grip on power did not rest largely on the annexation of Essequibo? If Maduro was simply left alone, it is much more unlikely he would’ve felt pressured into such an aggressive foreign policy and instead stuck with his classic move of indicting challengers to his rule. Indeed, Maria Corina Machado, the leader of the Venezuelan opposition, has already been barred from running in the 2024 Presidential election over corruption allegations. And yet again, attempts at multilateral condemnation fall short: when the European Union condemned Machado’s disqualification, Venezuelan parliamentary members echoed disapproval back at Brussels, asserting that there will be no EU electoral observation missions taking place.

By not recognizing the ineffective deterrent that is sanctions and potentially failing to imagine the ends Maduro would pursue to stay in power, American Venezuela policy is to blame. Once the nightstick of the Western liberal world order, the multilateral institution is now obsolete in its ability to effectively prevent conflict.

None of this is to say, of course, that Maduro’s regime is in any way supportable or beneficial to the Venezuelan people. Maduro’s regime deserves punishment, but is punitive action that can lead to a larger regional conflict—when the United States is already stretched so thin—best practice? It is highly probable that Guyana and Brazil would not have to deal with a desperate and aggressive Caracas if Maduro had not felt so pressured to flex his muscles on the regional stage.

And even if a new successor were to be freely elected, there’s no guarantee that they could survive corruption and a likely power vacuum in a post-Maduro Venezuela. Ultimately, regime change and democracy-building in Venezuela may prove more disastrous for the region than simply letting Maduro be. The empty threats of ineffective multilateral institutions do not compel Maduro to acquiesce, they only embolden him to strike out as he defends his unpopular presidency.

After all, there’s one rule when you’re in the jungle: never corner a wounded animal.