Transcription
This is arguably one of the most important things that's happened in geopolitics in a very long time. The United States moved into Venezuela and captured Nicholas Maduro, where he was removed from power almost overnight. The geopolitical chess game that's being played in the world right now has changed completely. It happened very fast and it threw a lot of people off guard.
And if you've been following the news, you've probably heard the explanation. This from the beginning has been about getting rid of Maduro, grabbing Venezuela's oil for American oil companies and Trump's billionaire buddies. And that's because Venezuela holds roughly 300 billion barrels of oil reserves, which is the biggest in the world. At around $57 a barrel, that puts the total value at roughly $17 trillion. Now, even if you wholesale that whole amount at 50% off, we're still talking about oil that's worth close to $9 trillion. And let me just put that number into perspective because that is more than the GDP of every country on Earth except the US and China. Now, that is roughly four times the size of Japan's economy. So, yes, there's definitely a lot of oil and that's why some people think that's what this is about.
Now, that story is not completely wrong. Venezuela really does have a huge amount of oil reserves and oil still powers the world and the global economy. But the truth is, oil has very little to do with this story. If this was really about oil, this operation would have happened years ago when Venezuela's production of oil was way higher and its infrastructure was less damaged. So then the question is, well, if it's not about oil, then why are we told it's about oil? And that's because that is the story that's easiest to explain. But behind that story is a much more interesting reason. And that reason is how global power actually works in the modern day. So, in today's video, I want to explain what that reason really is, why Venezuela was so important to the US, and why China, Russia, and Iran all matter here at the same time.
>> So, Iran's in big trouble. It looks to me that the people are taking over certain cities that nobody thought were really possible just a few weeks ago. Uh, we're watching the situation very carefully. I've made the statement very strongly that if they start killing people like they have in the past, we will get involved. We will be hitting them very hard where it hurts. And that doesn't mean boots on the ground, but it means hitting them very, very hard where it hurts.
So, >> and once you understand this chessboard, hopefully you'll be able to understand the rest of the world and where it might be going next and how it might affect your investments. This story is not just about oil and Venezuela. It is so much more interesting. So, with that said, let's get into it. Hi, my name is Andre Jick. Hope you're doing well. Come for the finance and stay for the oil. Except this time it's not actually about the oil.
And if you don't believe me, here it is directly from Marco Rubio. >> First of all, let me go back up. We don't need Venezuela's oil. We have plenty of oil in the United States. What we're not going to allow is for the oil industry in Venezuela to be controlled by adversaries of the United States. You have to understand, why does China need their oil? Why does Russia need their oil? Why does Iran need their oil? They're they're not even in this continent. This is the Western Hemisphere. This is where we live. And we're not going to allow the Western Hemisphere to be a base of operation for adversaries, competitors, and rivals of the United States.
>> To quote him, he says, "They're not even on this continent. This is the Western Hemisphere. This is where we live, and we're not going to allow the Western Hemisphere to be a base of operations for adversaries, competitors, and rivals of the United States." And this is where it helps to really understand how the United States actually works. You see, we have to understand about the president of the United States is that he's not the one to come up with these ideas to get into Venezuela and take out the leader. As much as some people may love the president, he was not the mastermind of this idea. That would be the job of the Pentagon. Once the Pentagon analyzes the interests of the United States, it then tells the president about the plan to which the president can decide yes or no.
Here's a very basic understanding of how this decision was made. There's three main things that need to be true at the same time for the US to do this. Number one, a rival power puts itself in a strategic region. Number two, that region starts to affect global trade, security, or leverage. And three, it sits inside of or close to America's enforcement zone, aka where the military bases are. Now, Venezuela checked every single box. First, geographically speaking, it sits inside the Western Hemisphere, which the US has treated as a core security zone for hundreds of years. Proximity-wise, Venezuela is close enough that if another country put its military there, it would threaten the mainland. So, that's number one.
Number two are the resources. Now, oil is nice, but the US has plenty of oil. What the US needs are strategic materials that are used by modern weapons, electronics, and defense systems. Those are the rare earths. And that's where China comes in. China has rare earths, but China and Russia also both need oil. Now, China has invested $100 billion into Venezuela, and they became close friends. The last thing the US wants to allow is for China's presence to dominate and to get their discounted oil from Venezuela while using their currency instead of the US dollar. That's a leverage point, very important that other countries understand. It's not okay to use their money to buy our oil.
>> They're going to from now on do trade in their own currencies. Get right around the dollar. They're creating a a secondary economy in the world totally independent of the United States. Okay. But then you add the third layer. Venezuela wasn't just allowing foreign money to be traded for oil. It was also hosting foreign advisers, intelligence sharing. Now, these aren't necessarily GDP or economy related things, but they're still huge threats to the US because now we're talking about projecting power to the world. Now, this is happening inside the Western Hemisphere, inside what the US considers its security perimeter. And you put all these three things together, and that's how the Pentagon makes its decisions. You have geography, a rival presence inside your gates. You have your resources which are strategic materials like silver, gold, rare earths and most importantly currency settlement right which money we're using to trade these things. And then you have security militaries working close together close to your house. Any of these by itself could be managed maybe two, but all three at the same time on America's side of the world. And that's why this happened when it did.
Okay. Now, you might be asking at this point, Andre, I don't know if I really believe that all of this is happening. And how do you actually know what's going on? And the truth is, I don't know for sure. All of this is based on very high-level military frameworks, strategies, and theories. But once you understand them, you'll be able to understand what's happening in the world and what might happen next. And I want to share those theories with you right now. But first, here is something I've been personally doing to keep stacking SATs while this plays out with the Gemini credit card, the sponsor of this segment. It's a card I've been using for a while now, and all opinions are my own, and we're not influenced by Gemini. I use it like any regular credit card for gas, groceries, and travel, but I earn Bitcoin every time I use it. It has no annual fees, and you can see the rates and fees in the description for more info, but you get up to 4% back and over 50 cryptocurrencies instantly, and you can choose which one you want. Personally, I have mine set to Bitcoin, but that's 4% on gas, transit, and ride share, 3% on dining, 2% on groceries, and 1% on everything else. It's a Mastercard World Elite. I've used it internationally with no problems. And every time I use it, it adds Bitcoin to my portfolio. And the best part is you're investing as you spend. In fact, according to Gemini, card holders who earned and held their Bitcoin for 1 year saw an average appreciation of 279%. And those are not your typical credit card points. So, if you're interested, click the link in the description or go to gemini.com/andre to get $200 in Bitcoin when you spend $3,000 in your first 90 days. Thank you, Gemini, for sponsoring this segment. And now, let's get back to it.
So, let me explain these theories to you, starting with maybe the most important one, and it's something called the Monroe Doctrine. Now, it's not some conspiracy theory. It's actually one of the oldest and most consistent views of US foreign policy, and it explains American foreign policy for about the last 200 years or so. Monroe Doctrine. We sort of forgot about it. It was very important, but we forgot about it. We don't forget about it anymore. Under our new national security strategy, American dominance in the Western Hemisphere will never be questioned again. >> It was first talked about in 1823 by President James Monroe. And at its core, the idea is actually very simple. The Western Hemisphere, aka the left side of the world, would not be open for foreign powers to colonize, militarize, or use as a base of operations. Now, at the time, the US was talking about Europe. The United States basically said, "If you're a European empire, don't bring your wars, your militaries, or your influence into this part of the world." In return, the US was like, we will stay out of the European conflicts. That was the deal.
Now, over time, obviously, that idea has evolved. The Monroe Doctrine stopped being about just colonization and it became about anything related to influence or US interest. In the modern day, it's about whether rival powers are embedding themselves economically, militarily, or strategically in the Western Hemisphere in a way that threatens US interests. That is how I know when Marco Rubio says, quote, "This is the Western Hemisphere. This is where we live, and we're not going to allow it to be a base of operations for adversaries." Everything he's saying is borrowed from the Monroe Doctrine. He's saying it doesn't matter if the influence is foreign soldiers, supply chains, oil, rare earths, whatever. The rule is that the United States does not want hostile power projection inside its hemisphere, aka its half of the world. And throughout history, this doctrine has been invoked over and over again. During the Cold War, the Cuban Missile Crisis, and every time it's followed the same format. When foreign powers threaten any of those US interests and they're too close for comfort geographically speaking, that's when the response escalates.
But the question is, hold on, because Venezuela didn't just suddenly become important in 2026 or even last year. So why now? And the truth is, it's actually been a long time coming. But what really changed is that Venezuela started to get too close and too friendly with an adversary. And it's an adversary that the US does not want to allow to build a home and use its resources on this side of the world. So that's the Monroe Doctrine. And that brings me to the other side of the world. And once you understand this one, it'll hopefully also let you understand what's happening and what might happen next.
So far, I've told you about the left hand side of the world because that's how the United States has spent the last 200 years defending itself. But the rest of the world, aka the right or the eastern hemisphere, has been playing a very different game. Over a hundred years ago, some of the earliest geopolitical thinkers asked a very basic question. What actually gives a nation its power? And out of that question, two ideas became the main forces that explain the eastern hemisphere today. One of those ideas is called the Heartland theory. And the theory is very simple. If you control the center of Eurasia, Europe and Asia, the huge land core that stretches across Eastern Europe, Russia and Asia, you control the most defensible, resource-rich region on Earth. And if you control that, you eventually control the world. Okay.
But then there was another idea of how to rule the world. It's called the Rimland theory, developed by an American strategist. This theory says, "No, actually, you don't have to rule all that land. Instead of focusing on the center of the map, look at the edges, the coastlines, the trade routes, and where economies actually connect together. If you control the outer perimeter of those strategic areas instead of the inside, you have a much bigger advantage. If rival powers control the countries along your coast, they don't need to actually invade you. They could just box you in. They can limit trade. They can limit naval access. They limit your ability to project power to the world. And over time, that puts landlocked countries at a disadvantage. And Russia is the perfect modern example of this. It controls huge territories across Eurasia. The classic Heartland theory. But most of that land is either landlocked or frozen for a huge part of the year. That's why Crimea matters so much. It gives Russia a year-round warm water naval port into the Black Sea and from there into the Mediterranean, and that's why Ukraine is also very important. Ukraine sits between Russia's heartland and the sea. If Ukraine joins NATO and the West, Russia is cut off from important maritime routes. So from a Rimland theory perspective, that's really, really bad. This is why controlling the inside alone is just not enough. You can own endless amounts of land and minerals and manpower, but if other powers control the coasts, the ports, and the seas, they control the rules of the game. That's also why Russia reacts the way it does, and why it does not want Ukraine to join NATO.
So now that you hopefully understand the big picture, let me tie all these theories and strategies together to paint a very basic picture of what's happening. So the world we live in right now is not just run on oil anymore. Yes, oil is still very important, but we have to look at where the ball is going, not where it has been. And in the future, it's the rare earths, right? It's the data infrastructure, the ability to keep building weapons and electronics and technology, AI, and eventually the robots. And this is where the United States has a very real problem. Under the One Big Beautiful Bill Act, the Department of Defense, or I guess the Department of War now, set aside $7.5 billion specifically for critical minerals with already over a billion dollars that's been spent to stockpile some of the rare earths and minerals that the US needs. But there's a problem. Right now, the United States is 100% import reliant, meaning we have to get it from someone else for 12 critical minerals and more than 50% reliant for 28 out of the 50 materials that are classified as essential to national security. So, the US can't just swap them out for something else. They are irreplaceable.
Now, China controls between 60 to 95% of global processing capacity for most of these critical minerals. And even more importantly, China processes about 91% of the world's rare earth elements. So, the US needs something China has because those supply chains almost always pass through Chinese refineries and that creates a choke point. It gives China a very powerful leverage point. And this is where Venezuela becomes a lot more important than most people realize because Venezuela doesn't just have oil. It also has huge deposits of things like coltan, rare earth elements, gold, bauxite, and other strategic materials that you need to build electronics and weapons. And for years, China was working with the Venezuelan government and routing those materials into Chinese controlled processing. In other words, China's not just buying these things on the open market. It was putting itself at the center of the supply chains, right at the source.
Now, from the perspective of the US, that's a nightmare. That's not good. It means materials that are important to US national defense are being extracted under the supervision of its competitor, processed by that same competitor, and then reintroduced back into the market. Now, that is a lot of leverage for China. So Venezuela then was not just about seizing oil. This is about denying them the leverage, denying control over being at the center of supply chains, denying their military presence, denying their currency experimentation, right? Denying this geographic proximity we talked about. And it's forcing negotiations to happen on terms that are much more favorable to the United States. And even though there is a lot of pushback from some media saying this is not lawful, right? This is not allowed. The president shouldn't be doing this. >> The truth is international law doesn't mean anything without a nation's ability to enforce them. If you can't enforce the law, all you can do is just condemn them.
Okay. Then, so then the question is, well, if this is how the world works right now, then what might happen next? What I'm about to explain is not the official policy, but it is a very common working theory in certain geopolitical circles. And once you understand it, a lot of recent events will hopefully start to make a lot more sense. And the theory goes something like this. What we're watching is a consolidation of power between the world's major superpowers. Each power is trying to lock down what it considers non-negotiables based on their geographies. Now, in this theory, Russia's priority is Ukraine because Ukraine sits between Russia and the sea. From Russia's perspective, losing Ukraine to NATO permanently locks them out of maritime access and leaves them strategically boxed in. China's priority is Taiwan. Taiwan is all about semiconductors, industrial supply chains, and control of the Western Pacific. From China's perspective, Taiwan is a very important core strategic asset. And the United States priority is the Western Hemisphere. That's Venezuela. That's Cuba. That's really anything, any place where rival powers could build military bases, control resources, or reroute supply chains in a way that could threaten US leverage.
Okay, so then the next question is what's next? And it seems like the next big move is most likely going to be Iran. Iran is important for a couple different reasons. First, Iran controls the northern edge of something called the Strait of Hormuz, which is one of the most important choke points in the entire world. Roughly 15% of all the oil in the world moves through that small stretch of water every single day. Saudi Arabia, the UAE, Kuwait, Iran, Qatar, all of their exports pass through that area. That gives Iran leverage way beyond its size, right? This is the classic Rimland power. Now, there is a second reason though. Iran supplies huge amounts of cheap oil to China and Russia, which the US doesn't want. Now, all of this is done outside of US enforcement. That weakens US sanction power and it makes China more independent of the US than the US wants. It's not just China. Iran also coordinates closely with Russia, especially since 2022. Iran supplies drones and weapons and all sorts of things that the US doesn't like. And then of course there's reason number three, which is the elephant in the room, which is Israel. Iran's threat to Israel is one of the most important reasons that the United States treats Iran differently from almost everybody else. Israel is very important to the US because Israel is also one of the biggest buyers of US military technologies and it's almost a proxy of security in the Middle East. So it's almost like the US can defend its interests in the Middle East without actually physically being there.
So Iran fits perfectly into everything that we talked about. It uses Rimland geography to threaten energy. It supplies oil to adversaries like China and Russia. It goes around the settlement network which is the US dollar. It pressures an ally and Iran's interests were also present in Venezuela. So, there's a lot of reasons, but more than likely, this theory says Iran is next for the US, Taiwan is next for China, and of course, Ukraine might fall to Russia. Now, none of this guarantees that's what happens next, but it does sort of explain the general idea of where it could be going next. Overall though, I'd love to hear your thoughts. Let me know down in the comments below. As always, I hope you have a wonderful rest of your day. Smash the like button. Subscribe if you haven't already. I'd love to see you back here next week. I'll see you soon. Bye-bye.